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CNBC PRO Talks

One of the top fund managers of the decade is holding triple his normal cash position

Jerry Dodson, founder and lead portfolio manager of Parnassus Investments, an independent investment management firm with about $20 billion under management, believes market participants may be running out of investment options due to high valuations.

"Right now the cash holdings of the Parnassus Endeavor Fund are 15 percent. Usually we like to have maybe 5 percent. But what's happening is, we are not able to find undervalued companies," said Dodson. "And the difficulty we think is that the market is fully valued."

The Parnassus Endeavor Fund is the top-performing large cap growth fund over the last three, five and 10 years, according to Morningstar. The fund is up 11 percent this year alone.

In this wide-ranging conversation with CNBC's Mike Santoli, Dodson shares his investment approach, and also discusses:

  • How there are still some values out there.
  • Three of his favorite long-term holdings.
  • Socially responsible investing.
  • His favorite investing lessons.

PRO subscribers can also read the entire transcript of the exclusive interview below.