BofA Survey Puts Stock-to-Bond Switch Threshold at 5.9%
Fund managers said the 10-year Treasury yield would need to reach 5.9% before they shifted asset allocation from stocks to bonds.
Key takeaways
- Survey respondents said a 5.9% 10-year Treasury yield would prompt a shift from stocks to bonds.
- 32% of fund managers named a disorderly rise in bond yields as the biggest market tail risk.
Fund managers surveyed by BofA said the 10-year Treasury yield would need to reach 5.9% before they shifted their asset allocation from stocks to bonds. The yield stood at 5.22% on Tuesday.
The article linked higher real yields to strong economic growth amid an AI boom. It also cited rising oil prices, concerns about AI risks and weak market breadth as factors behind warnings of a possible equity pullback.
In the survey, 32% of respondents said a disorderly rise in bond yields was the biggest market tail risk, while 23% pointed to an AI bubble. Asked whether there would be an AI bubble in 2027, 45% said yes and 42% said no.
This article was produced with the help of AI technology. Source: Yahoo Finance
