An increasing number of investment managers in this soon-to-be-completed first quarter view the markets as a "risk-on" opportunity,  a turnaround from previous quarters where uncertainty around risk prevailed, according to Russell Investment's Investment Manager Outlook (IMO) survey. 

Investment managers' bullishness for U.S. large-cap growth equities reached 69% for the quarter, up from 58% in the prior quarter.  

On the emerging markets front, advisors' bullishness increased 10 percentage points during the quarter, to 66%. Across style and cap levels, the latest IMO survey demonstrated managers' increased bullishness for equities. 

"Managers are seeing opportunities to take on moderate risk for what could be attractive return opportunities," said Rachel Carroll, consulting client executive at Russell Investments. "In fact, in the latest IMO survey we are seeing that they are more willing to invest in areas where, even six months ago, they were showing nervousness."

Reduced risk aversion and a search for better returns may also be driving the drop in bullish sentiment for corporate bonds and other fixed income asset classes, according to the survey. Manager bullishness for corporate bonds was 32% and U.S. Treasuries was 4 %, reflecting a drop of nine and five percentage points, respectively, from last quarter.

As a result of the ongoing challenges in Europe, an estimated 46% of the managers surveyed expect to have less-than-typical exposure over the next 12 months to companies that derive a significant portion of their revenue from Europe. Another 21% plan to have less-than-typical exposure to companies that are highly sensitive to the global economy as a whole, the survey says.    

Real estate saw a 12 percentage point jump in bullishness this quarter to 45%. While low in comparison to managers' responses on other asset classes, it represents an all-time survey high for real estate.

"Optimism around real estate is likely a reflection of the improving fundamentals in that market, particularly in areas such as core commercial real estate," Carroll said. "REITs (real estate investment trusts) have rebounded from their lows during the financial crisis and are within reach of their all-time highs--this is certainly a positive development as the real estate asset class can deliver useful diversification."