Risk appetite among professional investors is surging: Institutional investors’ equity allocation rose to 54.8% in July, the highest since the early months of the 2008 Financial Crisis. This is now ~4 percentage points above its long-term average. Excluding 2008, such a high allocation has only been seen during the 2000 Dot-Com Bubble. Institutional investors now hold 17.5% of their capital in cash and 27.6% in fixed income excluding Treasury Bills. All while State Street’s Investor Risk Appetite Index hit its second-highest reading in 11 years last month. Professional investors have rarely been this bullish.(The Kobeissi Letter)