Long Bitcoin is yet again one of the most crowded trades, according to BofA’s last fund manager survey of the year.

This is despite the fact that Bitcoin is currently trading around $47,000, down 31.5% from its all-time high of $69,000 hit in early November and no longer being a trillion-dollar asset.

Long Bitcoin, however, is not the most crowded; it actually comes in second place at 18%. It is ‘long tech stocks’ (39%) that are capturing the first spot by a wide margin. Long ESG (17%) is also among the most crowded trades.

According to the survey, fund managers increased their cash allocation to 5.1%, from 4.7% in November, the highest exposure since May 2020.

Managers are piling into cash ahead of central bank policy meetings while slashing their equity positions to the lowest since October 2020. Investments in stock, however, are still above the historical average.

The US investment said, “hawkish central banks” were the biggest tail risk that has caused a surge in cash and a more defensive asset allocation.

But if the Fed meeting turns out to be dovish, cryptocurrencies, unprofitable tech, banks, and emerging markets would rally, as per the survey.

An informal Bloomberg survey of 106 fund managers this month also found that a hasty shift by central banks is the biggest downside risk for global stocks next year.

The respondents also expect value stocks to outperform equities that soared this year on future growth expectations.

“We believe 2021 was a year of recovery and 2022 will be a year of resilience,” said Katie Koch, co-head of fundamental equity for Goldman Sachs Asset Management, which oversees about $2 trillion in assets.

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