Thus the repo market has become intimately linked to the cash market in Treasury bonds.
The repo market also helps participants to manage short positions in the cash market for government bonds.
The gravity of the situation is exemplified by the crunch on liquidity in the short-dated cash market.
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Everyone knows that the U.S. Treasury market is basically a cash market.
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The 2% decline was an understatement, however, as U.S. equity futures sold off another -0.8% after the cash market close on Friday.
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Although the indices have stabilised since then, the cash market has not.
He said Argentina's property market appeals to him because "it is a cash market, " less likely to be affected by rising and falling interest rates.
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Higher futures prices could have sent a signal to commodity producers, who then decided to hoard their stocks rather than sell them in the cash market.
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That is, when the futures markets get out of synch with the cash market for stocks trading on stock exchanges, the computers instantly spot the difference and pounce, buying one and selling the other for a few minutes, which brings them back into synch.
In 2010, it controlled nearly 26% of the cash equity trading market in the U.S. If Nasdaq acquired NYSE, it would become the leader in the cash equity trading market in the U.S. with about 44.6% market share.
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The problem with moving to cash when market conditions are considered to be unfavorable is knowing when to get back out of cash.
If the cash-market yield is also rising, it demonstrates that the market is placing a higher premium for that particular risk.
For instance, mutual funds have a history of holding high levels of cash at market bottoms and being fully invested at market tops, and they have stepped up their buying in the last two months.
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It might be a better or worse way of doing it than using a cash intermediated market to do it, or using a tax funding but provision by market competitors to do it but it is still a market.
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This would leave you 40% in cash if the market moves higher, or 60% in cash if we get a drop below key support.
It may feel safe to put your money in the top performing funds in a bull market or into cash and bonds during a bear market, but both are actually riskier than they seem.
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Anyone who has ever put cash in the market knows that making money in stocks is hard.
So I recommend raising cash when the market seems vulnerable and then look for a new entry point.
The low interest rate environment also makes holding gold funds better than holding cash or money market funds, he says.
For example, some custodians require pensions to sweep all their uninvested cash into money market mutual funds affiliated with the custodian.
Passionate entrepreneurs who lack cash can successfully market their ventures with publicity.
And for young and growing companies, an auction allows the company to raise as much cash as the market is willing to afford it.
My investment theme continues to be that investors should be raising cash on stock market strength until they have a 50% maximum allocation to stocks.
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Why is it that many pensions pay substantially higher fees for their money market cash sweep than they pay their best performing bond and equity managers?
Lawmakers questioned the British-based bank over these accusations and more, demanding to know how and why its affiliates in India and elsewhere exposed the bank to black market cash.
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In this environment the prudent investment strategy is to raise cash on additional market strength even as the major averages trade to new multi-year highs and all time highs.
That's an amount equal to investors' cash in money market funds, an amount equal to 35% of the nation's total debt, a large multiple of the capital in sovereign wealth funds.
They studied average returns of investors in 401(k) plans who stayed fully invested and compared their actual returns to investors who sold and moved to cash during the market downturn in 2008-2009.
Cautious investors will prepare for any such disaster by investing in life boats big enough for their whole portfolios, but not so expensive that they would be better off just staying on the dry land of cash and money market funds.
Just recently, a Fidelity study reported that 401(k) participants who moved to cash during the market drop in 2008 and 2009 earned just 2% through the first half of this year, but those who stayed in and stuck with their long term strategy earned a whopping 50%.
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