Crane Data Subscribers
Bloomberg's Chet Currier Ponders Stock Funds' Record Low Cash Levels. As we also noted in our "Link of the Day" yesterday, stock mutual funds are holding record low levels of cash (3.6%). Currier writes, "From as high as 6.5 percent in late 2000, the ratio dropped to 3.9 percent of total assets in August 2005, going below 4 percent for the first time ever in ICI records dating back to 1975. It hovered at or slightly above that point for the next year and a half." While he questions whether this is indeed bad news for stocks, we've been arguing that it's good news for money funds -- stocks can't reduce their money market holdings any lower.
