CASH (CASH)

The S&P got overbought, led by the big 7 megatech stocks. Add to that seasonality when September is historically weak. He's holding 21% cash, but that will likely change in a few weeks if markets fall. He thinks the S&P can fall back to 4,200-4,300.

Cash is good. Cash makes sense.  If you don't like the market or don't like any stocks, then sell stocks and raise cash. This will protect you against a lousy market. Cash is for losers? Ridiculous.

The breadth and sentiment of the market is not great. He still holds cash to use if last week's correction results in a further small  pullback.

Lid on the S&P 500 is 4200 right now, and it hasn't cracked it since last year. He sold his S&P index when it got close. He's heavy into cash, around 33%. Beyond those 6 magic stocks on the NASDAQ, the broad picture shows that most stocks are going down. 

The TSX has a bit of upside potential to just over 20,000 for a trade, but how much will it take to get through that? Certainly the Canadian banks haven't reported wonderfully lately. 

He's in cautious mode. He'll wait and see what happens.

This is the start of a broader decline. If you must be in the market, maybe go into big tech, which lacks balance sheet and lending concerns, but there will be growth concerns. He isn't buying anything at all, but is preserving capital. Cash.

Be careful going into to cash, because you could miss the timing when it's actually better to be in stocks. He doesn't advocate raising cash.

The January rally was due to multiple expansion and add FOMO. The brunt of Fed activity (rate hikes) has yet to be felt. The market now is a good reset. There is an insatiable appetite to buy stocks, but it's better to be in cash, because the second half of 2023 will be miserable when we see the impact of these hikes. The risk now is to the downside.

It is an uncertain market and there is a risk of a hard landing so he has a substantial amount in cash. You can deploy it when it makes sense. It also gives flexibility. He holds some energy and defense contractors and is overweight in utilities and consumer staples.