Equity hedge fund managers have taken their most bullish stance in more than three years in the run-up to the end of the decade, defying fears of a fall in markets.

Long/short equity funds were about 45% net long equities last week, according to research just published by market analysts at Bank of America Merrill Lynch. The analysts said this was well above the upper end of the historical average, which is between 35% and 40% net long.