“A cash reserve has been raised in our US ETF accounts. A partial cash reserve has been raised in non-US ETF accounts. Our clients will see them in the online-access versions of their account statements.
Why did we raise cash?
Stock markets have become extended, particularly in the United States. Nothing goes straight up or straight down forever. History shows stock markets can have 3% to 7% corrections at any time.
The present long-term bull market started in March 2009. It was reaffirmed in November 2012. It is still intact. That said, most measures of market movement, sentiment, direction, and momentum have reached levels of intensity that approach extremes. This is primarily a US phenomenon.
We believe prudence requires a cash reserve as activities in Washington and the rest of the world continue to unfold….”
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