BofA clients with $561bn say Bitcoin is most crowded trade

Bloomberg

For the first time since 2017, Bank of America Corp. (BofA) clients with $561 billion combined say Bitcoin is the world’s most crowded trade as speculative euphoria hits Wall Street.
Investors surveyed by the investment bank see signs that long positions in the largest digital currency are reaching unprecedented levels, while retail traders and institutional names join the crypto boom.
The Bank of America poll doesn’t necessarily mean that more fund managers own Bitcoin. But it’s another temperature check on the token’s 400% rally over the past year that’s dividing some of the biggest names in finance.
The survey also shows investor positioning is booming across reflation strategies from small caps and value companies to emerging markets. Stock allocations have spiked to the highest level in three years as conviction on an early-cycle economy rises to the highest in more than a decade.
With BofA clients the most optimistic on profit expansion since 2002, “extremely bullish” sentiment raises the risk that a market correction is “imminent,” strategists led by Michael Hartnett wrote in a
report.
With 73% of investors projecting the global economy is in the throes of an early-cycle expansion — the most since 2010 — investors are wagering on companies tied to the economic cycle even as fresh lockdowns and valuation risks bite. US fiscal stimulus and vaccine hopes are also spurring a record number of traders to brace for a steeper yield curve and higher inflation.