Thursday, June 4, 2015

Mutual Fund Cash-to-Assets Ratio .........ANOTHER PESKY FACT!

Mutual Fund Cash-to-Assets Ratio

Fund managers have altered their behavior dramatically over the past 30 to 35 years. Cash has truly become trash. Partly this is due to the fact that yields on "safe" near-cash investments are non-existent, and partly it is due to career considerations. Managers will be punished for missing a rally, but there will be no repercussions from being caught in a debacle with everybody else. Once again one can clearly see the stark difference between the situation at the beginning of the secular bull market in the early 1980s and today.

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