Investors shifted out of bonds into equities and commodities in November as confidence in the global economic recovery underpinned their risk appetite, a survey showed on Wednesday.

According to the monthly fund managers survey from BofA Merrill Lynch, the net underweight position in bonds among investors rose to 31 percent of their portfolio this month, its lowest since April 2008, from 23 percent last month.

This means the difference between bond underweights and overweights is 31 percentage points.

The overweight position in equities rose to 37 percent from 36 percent in October, while the overweight position in commodities reached a record high of 25 percent.

It's a benign macro economic backdrop, providing a good environment for risk appetite overall. Investors have pro-growth, pro-inflation asset allocation, said Gary Baker, head of European equity strategy at BofA Merrill Lynch.

Risk appetite remains very high but stable. It's quite a strong macro backdrop but no one is getting carried away.

The survey, which polled 218 fund managers managing a total of $534 billion, showed its risk appetite index remained unchanged at +44, compared with the long-term average of +40, while cash balances also held steady at 3.7 percent.

Regionally, emerging markets were the most favoured, with the net overweight position rising to 53 percent in November from 46 percent last month. High-beta markets such as Russia and China were the preferred countries.

The net underweight position in Japan rose to 30 percent from 24 percent in October. More than one in four respondents, on a net basis, wants to underweight Japan the most on a 12 month view.

Anything Japan, people don't like. They've given up on Japan as an investment destination, Baker said.

Hedge funds remained unwilling to leverage holdings significantly, with the current ratio of their gross assets relative to the capital stood at 0.96 this month, compared with 1.02 in October.

Their net exposure to equity markets - measured as long minus short as percentage of capital -- jumped to 34 percent from 26 percent.

A net 36 percent of investors regarded the dollar as undervalued, compared with just 1 percent in September.

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