US markets churn and investors hide cash despite rising inflation

Since the pandemic began in 2020, money market funds have returned virtually nothing.

As a result, cash has become a more appealing haven for investors seeking refuge from market volatility.

The S&P 500 is down 18.7% this year, and the ICE BofA U.S. Treasury Index is on track to have its worst year on record.

Cash has lost favour with investors due to inflation and high interest rates.

Extreme cash levels are sometimes regarded as a so-called contrarian indicator that portends well for equities.

Cumberland Advisors’ chief investment officer stated that his equity portfolio in the United States is currently 48% cash.

“The only way I can seize it is if I have that much cash,” says David Kotok.