FPA's Robert Rodriguez Likes Cash

Are you getting paid enough to hold stocks and bonds?

Robert Rodriguez doesn't think so. That's why he keeps raising the cash stake in his $2 billion (FPPTX Quote)FPA Capital fund. The California-based contrarian currently has more than a third of his portfolio in cold hard Treasury bills. The rest has been faring quite nicely in small- and mid-cap value stocks, and he has no qualms about holding more cash until valuations fall or risk premiums rise.

And it's not like holding the cash is hurting his performance. The fund has been a winner for over two decades and is up 14.5% this year, almost triple the Russell 3000 Value Index. Rodriguez also keeps a relatively low expense ratio of 0.85%, so it's hard to accuse him of charging too much for a glorified money fund. ...