Buy Side Sentiment Tracker
February 2026
Views from 44 top asset managers across 73 assets, based on 1,300+ individual views
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Main takeaways
Overall sentiment: the most bullish reading since we launched the BSST in 2024 (new high, above Dec-2024)
Cyclicals: the clearest message across assets is “Buy Cyclicals” (sectors + factors)
Emerging Markets: divergence is widening — EM equities & EM debt loved, while China equities downgraded for a 4th straight month
Tech: loses its #1 spot (or is barely clinging on), but remains far from unpopular
Sentiment: Record Bullishness
Buy-side sentiment took another step higher — to a new BSST high, exceeding the December 2024 peak.
Risk appetite
Risk appetite rose in all 5 risk-on/risk-off indicators
All 5 indicators are at the highest level in the 16-month history
Big asset-class shifts
This was a classic risk-on month: the riskiest assets upgraded — and defensiveness (cash/sovereigns) faded further.
Equities: upgraded again to +78% net bullish (top major asset class)
33 Bulls | 7 Neutrals | 1 Bear
Cash: downgraded again to -50% net bearish (new low; least popular asset class by far)
Sovereigns: downgraded to -17% net bearish (2nd-lowest on record)
Positioning tilt
Clear pro-cyclical lean: biggest overweight of cyclical sectors in BSST history
Small caps upgraded to their most bullish reading in 10 months
Equity Regions
US equities
Biggest upgrades among regions: a sharp recovery from “least popular” after Liberation Day to 2nd most popular.
Now +45% net bullish.
EM vs China: divergence widening
China: 4th straight month of downgrades → least bullish in a year
Rest of EM: upgraded again → +61% net bullish (top region)
New: India
First month in the tracker: 7 views → 4 Bulls | 3 Neutrals | 0 Bears
Japan
The “Takaichi bounce” is still alive: upgraded to +34% net bullish.
Most bullish in BSST history, but still room for upside if reform/fiscal optimism is confirmed by data.
Europe & UK
Europe: small upgrade, but sentiment has treaded water since last spring — still net bullish, but 2nd-least popular region.
UK: least popular region for a 4th month — not surprising in a month where investors are pushing pro-cyclical exposure.
Equity Sectors
Cyclicals led the upgrades
Broad upgrades across Energy, Industrials, Materials
Financials also benefited (cyclical characteristics)
This was the clearest pattern across sectors.
Tech: cooling, not capitulation
Technology: still at/near the top, but no longer running away with it.
Importantly: Tech underperformance has not triggered meaningful capitulation-style downgrades — consistent with what other sentiment indicators show.
Where the downgrades were
Communication Services: largest downgrades (another tech-heavy pocket) —consistent with broader sector sentiment.
Defensives
Mixed, but the broader story was cyclicals up rather than defensives down.
Health Care and Utilities remain net popular.
Consumer Staples
No fresh downgrades this month, but still -40% net bearish — weakest sector and close to historical extreme pessimism territory.
Equity Factors: Value > Size
Value and Size both upgraded, but remain well below their popularity a year ago.
Value remains the most popular factor at +34% net bullish (still well within the past year’s range).
EU factor reads (small samples)
EU Value: scarce views (3 total); 2 of 3 bullish
EU Small Caps: more coverage and more positive: 5 views, all bullish
Small caps
Upgraded in line with the pro-cyclical shift.
US small caps now most popular since last April, though sentiment is still only +10% net bullish — plenty of upside potential if the rotation continues.
Currencies
US dollar: third upgrade in four months, but still the most bearish asset in the entire 73-asset universe.
This time last year: +62% net bullish → today: -60% net bearish (largest 1-year reversal by far)
GBP: downgraded; slightly net bearish, mid-pack.
EUR & JPY: remain the preferred G10 counterparts to a USD short
EUR: less bullish than summer, but still by far the #1 currency long
JPY: biggest downgrade of any asset this month — from very popular in May to roughly neutral now
Sovereigns
Despite the asset-class downgrade, the picture underneath is mixed.
Two clear buckets
Net bearish: US Treasuries, Bunds, JGBs
Net bullish: EMD, Gilts, Linkers
Highlights
Local-currency EMD: #1 sovereign for the 5th straight month; upgraded again to +76% net bullish (BSST record). Now the 4th most popular asset in the tracker. Hard-currency EMD upgraded too, but the gap remains.
Gilts: downgraded, but still most popular DM sovereigns at +42% net bullish
JGBs: steady comeback as BOJ shifts and yields rise; bearishness easing back toward neutral
Bunds: upgraded from a low level, but still -16% net bearish
US Treasuries: another downgrade to a new tracker low at -39% net bearish — 4th least popular asset in the whole tracker
Credit
Private Credit: first upgrades since September. Still very popular at +64% net bullish, even if the extreme crowding of a year ago has faded. Sentiment is not yet low enough to offer much downside protection.
Investment Grade: small downgrades; 7th straight month of downgrades at the asset-class level. Preference remains Europe > US.
High Yield: small downgrade; still preferred to IG, again Europe > US.
Commodities
Gold: second straight month of upgrades; +88% net bullish (2nd-most popular asset)
26 Bulls | 4 Neutrals | 0 Bears
Industrial metals: already near max bullish at +90% net bullish — almost everyone with a view is bullish
Oil: surprising downgrade given performance and Energy upgrades — leaves oil roughly neutral, consistent with other sentiment indicators
Alternatives
Infrastructure: universally loved — 100% bullish (16 Bulls, 0 Neutrals/Bears)
One-sided narratives can persist, but the vulnerability to negative news rises (we’ve seen this dynamic before in Gold and Private Credit).
Private rotation: Private Equity gaining fans as Private Credit loses them — looks like rotation within privates, not abandonment.
Have a great week — and good luck out there.
—Lars