The credit crunch has led to fund managers allocating record amounts to emerging market equities and pulling money out of Japan and the eurozone to fund their investments, but strategists have warned over the outlook for the asset class.

More global investors have increased their emerging market positions since April 2004 to overweight, where investments are proportionally greater than the benchmarks selected by each fund manager, according to the latest monthly edition of the Merrill Lynch Global Fund Manager Survey.