DB Investor Positioning and Flows Rotating On Cue Again

Global Asset Allocation Date 31 July 2026 Investor Positioning Strategy Update and Flows

Rotating On Cue Again Parag Thatte Strategist The rotation out of Tech began on cue two months ago from the top of its long-run Binky Chadha trend channel (Tech Comes Full Circle, May 15 2026), and in our reading, the Chief Strategist rotation back has also begun on cue after hitting the bottom earlier this week. MCG & Tech positioning fell sharply from elevated levels to near neutral this week and has bounced slightly higher (62nd percentile). It is in line with earnings growth around Karthik Prabhu Strategist 20%, i.e., already implying a sharp slowing from the 52% it is tracking for Q2 (Q2 Earnings: Broad Based Acceleration, Jul 31 2026). We see the rotation into Tech having further to go with a typical outperformance of 20pp. This would be the Dag Workayehu 5th such rotation in the last 3 years with the market focus repeatedly swinging Strategist between stellar growth and bubbles fears at an increasing rate. Within Tech, we see

the best risk-reward in the hyperscalers whose relative performance to the S&P 500 is just off the bottom of a 3-year range.

Positioning and flows details on page 8

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Investor Positioning and Flows

Figure 1: The relative performance of MCG & Tech has again bounced off the bottom of its long-run trend channel …

Log S&P 500 MCG & Tech ratio* to the rest of the S&P 500 Log 6.2 (in logs, reindexed, Jan 1 2010 = 100) 6.2 6.0 Trend (since 2016) growth: 14.2%, annualized rate 6.0 5.8 Band +/- 10%

Jun-15 Jun-16 Jun-17 Jun-18 Jun-19 Jun-20 Jun-21 Jun-22 Jun-23 Jun-24 Jun-25 Jun-26

*natural log of the ratio Source : Bloomberg Finance LP, Deutsche BankAsset Allocation

Figure 2: … for the 5th time in the last 3 years

Log MCG & Tech ratio* to the rest of the S&P 500 Log 6.3 (in logs, reindexed, Jan 1 2010 = 100) Jun 1st 6.3

6.2 Oct 29th 6.2 Trend (since 2016) growth: 14.2%, ann. rate Dec 24th 6.1 Band +/- 10% 6.1 Jul 10th 6.0 6.0

5.7 5.7 Sep 6th Apr 4th May 19th 5.6 5.6

Jun-23 Sep-23 Dec-23 Mar-24 Jun-24 Sep-24 Dec-24 Mar-25 Jun-25 Sep-25 Dec-25 Mar-26 Jun-26 Sep-26 *natural log of the ratio Source : Bloomberg Finance LP, Deutsche BankAsset Allocation

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