A $1 Trillion Cash Pile Holds Key to the Fate of Risk Assets
- Money-fund assets drop 4 straight weeks, first time since 2017
- Cash on sidelines is potential ‘powder’ for risk assets: Yi
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The $1 trillion pile of cash that investors amassed amid the pandemic-fueled market turmoil may determine the length of the risk rally.
U.S. money-fund assets have started to shrink from a record high. Roughly $105 billion has exited after four weeks of outflows, the longest such streak in more than three years, Investment Company Institute data show. The shift coincided with emerging signs of an economic recovery that drove the S&P 500 Index to the highest since February, and a historic rush into fixed-income exchange-traded funds as the Federal Reserve supported that market.