Why Rising Bond Yields Are Making Cash a Genuine ASX Trading Position in 2026
Written by Christopher Hall, AdvDipFP | Authorised Representative, AFSL 526688 | Updated September 2026
Analysis sourced from Gary Glover (AR 259215), Authorised Representative, Novus Capital Limited (AFSL 238 168)
Holding cash is a genuine ASX trading position when interest rates make sitting out a properly compensated alternative to trading, not merely inactivity while waiting for a setup. Gary Glover, Authorised Representative of Novus Capital Limited (AFSL 238 168), who reviews ASX momentum stocks in a recorded weekly session with Finer Market Points, made exactly this point during the 11 September 2026 session: with Australian 10-year bond yields at their highest level since 2011, cash now earns a return that momentum traders have not had to weigh against trading for roughly fifteen years. This guide explains why the calculus has changed, how much a trader can realistically earn sitting in cash, what Mark Minervini says about treating cash as its own position, and how a trader decides when holding cash is the more disciplined choice.
Why Are ASX Momentum Traders Weighing Cash Against Trading in 2026?
Rising Australian bond yields have made cash a genuinely competitive alternative to active trading for the first time in around fifteen years, on Gary Glover's own reading of the current rate environment.
"That fifteen year point is because the ten year bond yields in Australia are the highest they've been since twenty eleven. That's important from the valuation... perspective." — Gary Glover, FMP session, 11 September 2026
Gary Glover's anecdotal observation, developed across his trading career, is that in a near-zero-rate environment cash pays nothing, so trading — even a marginal setup — was effectively the only way to generate any return at all. A higher cash rate removes that pressure: a trader no longer has to force activity simply because the alternative was zero. This is a practitioner observation, not a formal study, and it does not change how a genuine setup is assessed — it changes the comparison a trader makes before deciding to act on a weaker one.
How Much Can a Trader Actually Earn by Holding Cash Instead of Trading?
A trader sitting in cash through a difficult ASX stretch can still realistically earn a mid-single-digit return, without carrying the risk of forcing a marginal trade to stay active.
"We might only need a few small pockets or windows of winning weeks or trades, and then four or five percent returns can come from the cash account." — Gary Glover, FMP session, 11 September 2026
This reframes the opportunity cost of not trading: sitting out is not a zero-return default, it is a positive-yielding one. Gary Glover's anecdotal observation is that this changes how much pressure a trader should feel to be active during a genuinely quiet stretch. For the fuller picture of just how concentrated ASX momentum gains are — the specific finding that a small number of weeks each year account for the bulk of annual returns — see the concentrated weeks that drive most ASX momentum gains, which sets out that data in detail; this article does not re-derive it.
The FMP Momentum Profile — accessible to FMP YouTube Momentum Profile members — included relative-strength and setup-quality readings at the time of the 11 September 2026 session, giving members early access to the educational data discussed in this article.
What Does Mark Minervini Say About Treating Cash as a Trading Position?
Cash is not merely a byproduct of no trade being available — professional trading discipline treats time spent out of the market as a position in its own right, not an absence of one.
"In the year I won the US investing championship, I was up 155%. If you averaged out my exposure in the market, I was only in the market about 50% of the time." — Mark Minervini, Webinar on Big Returns
Being selective and accepting long stretches out of the market does not cost the ultimate return if a trader is fully positioned when a genuine setup appears — the return comes from the quality of the time spent in the market, not the quantity. Gary Glover's own estimate, developed across his trading career, is that he is in cash roughly half the time as well — an independent practitioner arriving at close to the same figure as a professional trader describing a championship-winning year. This is a practitioner observation, not a formal study, but the convergence is worth noting on its own terms.
How Does a Trader Decide When to Hold Cash Instead of Taking a Trade?
The discipline here is selectivity, not avoidance — restricting activity to the highest-quality setups rather than trading in order to stay busy.
"I wouldn't be taking any trade here right now... these are like A-plus setups only. I wouldn't be taking sort of B pluses or B setups here." — Gary Glover, FMP session, 11 September 2026
Gary Glover's anecdotal practice, developed across his trading career, is to raise the bar on setup quality during a difficult stretch rather than lower it to stay active — a discipline closely tied to expected value and position sizing: a marginal setup traded at full size in a weak market carries a worse expected outcome than the same setup would in a strong one. Gary's own description of his current activity — "I'm not really trading too heavily at the moment... preserve the capital" — reflects the same selectivity applied to his own trading, not only as general advice.
Conclusion
Rising Australian bond yields have genuinely changed the calculation ASX momentum traders make between trading and holding cash — for the first time in around fifteen years, sitting out pays a real, positive return rather than nothing. Mark Minervini's own account of a championship-winning year spent roughly half in cash, and Gary Glover's independent estimate of a similar proportion, point to the same underlying discipline: selectivity, not constant activity, is what protects the ultimate return. Traders working through this material are best served watching for genuinely high-quality setups to re-emerge rather than treating a quiet stretch as a reason to lower their own standards.
The analysis in this article draws on Gary Glover's recorded session and the FMP Momentum Profile data, which is published daily and accessible to FMP YouTube Momentum Profile members. Members receive early access to the educational data that forms the basis of articles like this one. For information on FMP YouTube Momentum Profile membership, visit the FMP YouTube Momentum Profile membership page.
Remember that past performance is no guarantee of future results, and all trading involves risk.
Frequently Asked Questions
Why are ASX momentum traders holding more cash in 2026?
Gary Glover's anecdotal observation, developed across his trading career, is that Australian 10-year bond yields reaching their highest level since 2011 has made cash a genuinely competitive alternative to trading for the first time in around fifteen years. In a near-zero-rate environment, cash paid nothing, so trading was effectively the only way to generate a return; a higher cash rate removes that pressure and allows a trader to be more selective. This is a practitioner observation, not a formal study.
How much can a trader realistically earn by sitting in cash instead of trading?
Gary Glover's anecdotal estimate from the 11 September 2026 session is that a trader can realistically earn around four to five percent by holding cash through a difficult stretch, without needing to force a marginal trade to generate a return. This reframes sitting out as a positive-yielding default rather than a zero-return one. It is a general observation, not a guaranteed outcome, and cash returns vary with prevailing interest rates.
Does holding cash mean missing most of the ASX's gains for the year?
Not necessarily. FMP's own research on ASX momentum trading conditions shows that a concentrated number of weeks each year — see the concentrated weeks that drive most ASX momentum gains for the full breakdown — account for the bulk of annual gains. A trader who is selectively positioned for those windows, rather than constantly active, is not necessarily giving up meaningful return by holding cash the rest of the time.
What is Mark Minervini's philosophy on holding cash as a trading position?
Mark Minervini has described being in the market only about 50% of the time during a championship-winning year in which he was up 155%, framing time out of the market as a deliberate position rather than an absence of one. His view is that being selective about when to be exposed protects the ultimate return, rather than diluting it — a philosophy Gary Glover's own roughly 50% cash estimate independently reflects as well.
How does a trader know when it's time to hold cash instead of taking a trade?
Gary Glover's anecdotal practice, developed across his trading career, is to raise the quality bar during a difficult market rather than lower it — restricting activity to what he describes as "A-plus setups only" and avoiding B-plus or B-grade setups he might otherwise consider in stronger conditions. This is a discipline of selectivity tied to position sizing and expected value, not a fixed rule for exactly when to hold cash. This is a practitioner observation, not a formal study.
Sources
# | Source | Type |
1 | Gary Glover (AR 259215), Novus Capital. FMP Session, 11 September 2026. | Practitioner session |
2 | Mark Minervini, Webinar on Big Returns. | Published research |
All Gary Glover observations in this article are anecdotal practitioner observations developed across his trading career — not formal studies.
Related Finer Market Points Educational Resources:
This article includes a general trading observation made by Gary Glover (AR 259215), Authorised Representative of Novus Capital Limited (AFSL 238 168), during a recorded Finer Market Points session on 11 September 2026. The observation reflects Gary Glover's general approach and his anecdotal observations developed across his trading career — it is general commentary only, and is not a formal study, not financial advice, and not a recommendation to trade any security. It was made in the course of that session and not in response to any individual's circumstances. Content has been edited and summarised by Finer Market Points for educational purposes.
This content is for educational purposes only and does not constitute financial advice. Past performance is no guarantee of future results.
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