Fund managers haven't changed their investment strategies for the tech sector – in spite of the recent heavy selling that saw the Nasdaq log its worst day in two and a half years, according to a new data.
Fund managers globally were seemingly unfazed by the severe pullback with more investors overweight in technology than any other sector, the monthly Bank of America/Merrill Lynch Fund Manager Survey for April showed.
Almost 40 percent of managers surveyed were still overweight technology, way ahead of industrial stocks, the second most preferred sector, with a 27 percent overweight allocation.
Emerging market equities also benefited from fund manager optimism, with extreme underweight positions cut from 31 percent in March to 13 percent this month.
Stocks have been hit recently by concerns over weak corporate earnings and high valuations, encouraging some investors out of riskier assets, particularly momentum stocks, and into safer cyclical equities such as financials, basic resources and autos.
Global markets managed to snap that losing streak on Monday with Wall Street embracing data that showed U.S. retail sales had jumped the most since 2012.
A preference for value might offer one clue to the recent sell-off in technology and biotech stocks, said Michael Hartnett, chief investment strategist at BofA Merrill Lynch Global Research who found a record number of investors believe value stocks will outperform growth stocks over the next 12 months.
"Recent market volatility has led investors to 'taper' their extreme bullishness on U.S. growth-plays and extreme bearishness on emerging markets," he said.
Cash allocations also remained close to a two-year high, but the selloff has not led to pessimism on risk assets as investor added to equity positions in April even as the highest percentage of investors since July 2000 think stocks are overvalued, the survey found.
The online and telephone survey polled 239 fund managers with a total of $674 billion of assets under management between 4th and the 10th April.
—By CNBC's Jenny Cosgrave