By CCN Markets: The Dow Jones closed in on record highs on Thursday, but for one billion dollar fund, this is the perfect time to lock in profits.
Pictet Wealth Management, which manages $222 billion, is cashing out of stocks at the top of the market and piling up cash reserves. The fund is now building a defensive portfolio in the face of global trade war fears.
Is it a sign that the Dow Jones rally is running out of steam?
Dow futures jump 200 points, just shy of record high
Dow Jones Industrial Average futures surged on Thursday after the Federal Reserve hinted at rate cuts on the horizon. Investors cheered the dovish tone, pushing the Dow 226 points higher (0.85 percent) in pre-market trading. At 5.58 am ET, Dow futures hit 26,755, just shy of its record close of 26,828, set on October 18th.
Wealth managers cash out of risky stocks
Investors have locked in a decade of solid gains since the 2008 crisis. But as US stock market indexes tease record highs, Wall Street traders are taking profits and hedging for downside risk.
Pictet has shifted to a defensive portfolio strategy, almost doubling its cash holdings to 15 percent this year.