Should half of your share portfolio actually be cash right now? That’s what listed investment company (LIC) MFF Capital Investments Ltd (ASX: MFF) has done.

I really respect fund manager Chris Mackay, I think he’s one of the best investors in Australia. He has guided MFF Capital to be one of the best LICs over the past decade with great picks like Visa and Mastercard.

MFF Capital timed the payment of a special dividend well, coming just before the coronavirus market crash.

I think it was very interesting to see that in MFF Capital’s May 2020 update it said that net cash as a percentage of assets was now 46.4%, now almost half of the whole portfolio.

Mr Mackay is keeping in mind how factors like heavily populated cities, globalisation and widespread global travel are crucial for ongoing economic growth and the economic sufficiency of billions of people. But these factors are also partially how the coronavirus spread so easily.

Other geopolitical issues are also concerning to Mr Mackay with problems in Hong Kong and the riots in the US.

Should you sell half your portfolio?

I don’t think you need to be that drastic with your portfolio. I’m certainly not going to sell half my portfolio. But I am bit concerned for the US over the next six months. The riots, ongoing pandemic and upcoming US election could be a challenging time with the US president’s unique style.  

The share market recovery is somewhat justified with how much central bank support there is. And the fact that the pandemic isn’t as bad as it could have gotten despite there being more than 100,000 deaths in the US alone.

Not every share has a great future from the changes that the coronavirus will cause to the economy. But there are still opportunities out there that look good, particularly with how low interest rates are.

Having said that, I’d like to buy more MFF Capital shares. Mr Mackay is a great operator and now it’s well funded for downside protection and can buy plenty of shares if the share market is sold off again.

More reading

• Why I’m not afraid to invest in shares during this recession
• 10 top ASX growth shares to buy in June for strong returns
• How to make $1,000 a month in dividends
• Where I would put $10,000 into ASX 200 shares today
• Save your future self from financial misery

Motley Fool contributor Tristan Harrison owns shares of Magellan Flagship Fund Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The S&P/ASX 200 Index (ASX: XJO) was on form again on Wednesday and stormed notably higher. The benchmark index ended the day up a sizeable 1.8% to 5,941.6 points.

Will the market be able to build on this on Thursday? Here are five things to watch:

ASX 200 expected to race higher.

The ASX 200 looks set to race higher again on Thursday. According to the latest SPI futures, the benchmark index is poised to jump 72 points or 1.2% at the open. This follows a very positive night of trade on Wall Street, which saw the Dow Jones jump 2.05%, the S&P 500 rise 1.35%, and the Nasdaq index climb 0.8%.

6,000 points in sight.

With ASX 200 futures pointing to a strong rise at the open, the index looks set to smash through the symbolic 6,000 points market today. It has been almost three months since the benchmark index traded at this level. Investors will be hoping it is onwards and upwards from here.

Oil prices soften.

Energy shares including Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) will be on watch today after oil prices softened. According to Bloomberg, the WTI crude oil price is down 0.35% to US$36.68 a barrel and the Brent crude oil price has fallen 0.55% to US$39.34 a barrel. Traders appear nervous ahead of an announcement by OPEC.

Gold price sinks lower.

Improving risk sentiment has hit safe haven assets like gold overnight, which could mean miners such as Evolution Mining Ltd (ASX: EVN) and Newcrest Mining Limited (ASX: NCM) come under pressure today. According to CNBC, the spot gold price is down 1.9% to US$1,700.90 an ounce.

Magellan rated neutral.

The Magellan Financial Group Ltd (ASX: MFG) share price may be fully valued according to analysts at Goldman Sachs. The broker has reiterated its neutral rating and lifted its price target on the fund manager’s shares to $51.69. Goldman believe Magellan is on track to deliver strong performance fees in the second half. However, it feels this is already priced into its shares.

More reading

• ASX 200 jumps 1.8%, Australian headed for recession
• These ASX 200 shares could be perfect for a retirement portfolio
• The latest ASX 200 stocks to be upgraded to “buy” amid the recession
• Why I’m not afraid to invest in shares during this recession
• Top brokers name 3 ASX 200 shares to buy right now

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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