Investors of all sizes and shapes are nearly all in the pool now.Investor sentiment (in most surveys) is tilted very bullish, mutual fund investors hold near-record-low cash reserves, hedge funds are at multiyear highs in terms of net long exposure, and retail investors (though not at the extremes of 1999-2000) have plowed money into domestic equity funds en masse since the beginning of the year. Importantly, margin debt, the straw that stirs the market's drink, reached another high in October of $413 billion (up 3% month over month after rising 5% in September). In fact, margin debt is approaching the March 2000 and July 2007 highs as a percentage of GDP. Currently, margin debt is about 2.4% of nominal GDP vs. 2.6% in July 2007 and 2.8% in March 2000.
Kass: Everybody in the Pool
Dec 03, 2013 | 06:00 AM EST
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