Top investor Martin Sass joined CNBC Pro for an exclusive interview outlining his overall investment philosophy, as well as his specific strategy for 2016.
Sass, who manages $7 billion at M.D. Sass, a New York-based investment firm he founded in 1972, believes cash will be king in 2016. Since 1999, the flagship strategy of Sass' firm has more than doubled the cumulative return of the S&P 500.
"I've seen this movie before where you get a very few stocks, high momentum stocks, leading the market and the rest of the market is actually declining," Sass said, referring to the deterioration in market breadth.
He said other negative catalysts that could destabilize stocks include sharp losses in energy, pressure on illiquid junk bonds, decelerating growth in China and uncertainty over the direction of interest rates.
With 2016 beginning with a bang, Sass explained how investors can actually benefit from any potential downturns and position their portfolios for outsized returns. He also disclosed his favorite stocks and overall strategy on how to find value in the market.
Watch the video below of the full interview hosted by Mike Santoli.