Here is a chart of primary dealers treasury holdings. As you can see, smart money is preparing for the worst and moving to low risk treasury securities.

Here at the Shrewd Value Investor we stress the idea of holding lots of cash in your portfolio to take advantage of market opportunities. It is very important to be liquid in the market. Nothing is worse than seeing prices drop to undervalued levels and not having the ability to purchase undervalued shares in your favorite investment prospects. We still believe the market may experience a large downturn due to negative events coming out of Europe. Greece continues to struggle with its finances and its looking like a messy default is more and more possible. The market has continued to move upward on very low volume and behind the scenes market smart money continues to pile into U.S. Treasuries. We continue to hold a 100% cash position at this time as we wait for the right opportunities to deploy capital.

Advertisements