Institutional investors and global fund managers are increasingly favoring international stocks over U.S. equities for long-term outperformance, according to Bank of America’s latest Global Fund Manager Survey. An overwhelming 54% of respondents selected international stocks as their top-performing asset class for the next five years. In contrast, just 23% expect U.S. stocks to lead. Another 13% favored gold, while a minority cited corporate bonds (3%) and government bonds (2%) as likely top performers. 

The June survey showed continued rotation across global portfolios. Managers increased allocations to emerging markets, global equities, and the energy sector, while reducing exposure to the euro, utilities, and cash positions. Eurozone equities, emerging markets, and bank stocks now represent the most overweight sectors, while U.S. equities, the dollar, and energy remain the most underweight relative to historical norms. 

Notably, fund managers are now more underweight the U.S. dollar than at any point in the last 20 years, reflecting growing sentiment shifts away from U.S. assets and currency exposure. At the same time, positioning remains historically overweight in the euro, bonds, and utilities sectors compared to 20-year averages. 

Bank of America also noted a continued rebound in overall investor sentiment as trade war and recession fears subside. Manager sentiment is now approaching pre- “Liberation Day” levels, signaling a more constructive outlook on global growth and risk appetite heading into the second half of 2025. 

Conducted from June 6 to 12, the monthly poll captured responses from 190 institutional investors managing $523 billion in assets worldwide.