As the market hits new highs it appears traders are beginning to get a little more cautious based on the latest data of fund flows for the Rydex family of mutual funds. As I’ve written before, while sentiment polls are somewhat helpful, being able to watch what investors are actually doing provides a much clearer lens into the mind of the market. Even though the S&P 500 ($SPX) has been moving higher, albeit at a slow choppy pace, it seems both the bears and the bulls are hoping for a pullback but for difference reasons.
Below is a chart of the Total Money Market Assets at Rydex, as you can see since mid-2012 we’ve seen a slow set of higher highs. It’s important to note that this is a total number not as percentage of total assets, so as more traders add funds to Rydex this figure will rise which doesn’t mean investors are shifting out of stocks or bonds and into cash. What is interesting is to see that off the low in April of this year, the amount of money in money market assets has been going up right along with the equity market.
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