Question

"Institutional portfolio managers have been allocating an increasing percentage of their funds to cash and cash equivalent positions. This is an indication that their market sentiment is:"

Answer 1

Answer:

Bearish

Explanation:

In the financial markets a bullish market is when securities being traded are increasing in price. While a bearish market is when securities reduce in price.

Investors buy more securities in a bullish market, so they have less cash.

In a bearish market investors sell the securities that are losing value, so they will have more cash on hand.

So cash position increased in a bearish market while cash position reduces in a bullish market