The latest Merrill Lynch Fund Managers Survey showed that 80% of fund managers expect the economy to grow next year (see Merrill’s actual 2010 outlook here). Expectations for corporate profits are at their highest level since late 2003. Last month the survey showed that 52% of fund managers expected 10% earnings growth or more in 2010. The latest reading showed a robust 62% of managers now see 10%+ growth in earnings. 6% of managers are underweight cash while 18% were overweight cash as of last month’s reading. Michael Hartnett, Chief Global Equity Strategist at ML said:
“Investors are nervous but optimistic heading into the new year, and respondents are looking for a 7.7 percent total return from global equity markets.”
Meanwhile, strategists are once again predicting higher equity prices next year, which appears like the same safe bet they make each year:
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.