August 13, 2019 / 9:54 AM / 3 months ago

European fund managers slash risk as trade war worries grow: BAML survey

LONDON (Reuters) - A record number of fund managers in Europe have taken out protection against a sharp fall in equities and lowered their risk levels more than normal amid growing worries about the U.S.-China trade war, a key investor survey showed on Tuesday.

Bank of America Merrill Lynch’s latest monthly survey of European managers found the equities allocation is at a net 3% underweight and UK positioning has dropped to net 29% underweight.

The survey was carried out between Aug. 2 and Aug. 8.

A net 59% of investors expect the European economy to weaken over the next 12 months, increasing from 32% last month and the highest since December 2011.

Cash levels dropped in the region to 4.2% from 5.2% in July with money piling into high quality stocks, while some 28% of respondents expect the UK to leave the European Union by Oct. 31.

Reporting by Josephine Mason; editing by Thyagaraju Adinarayan

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