Buy on the prospect of deregulation. Sell on the enactment of deregulation.
That's the strategy that billionaire investor Marc Lasry is implementing, according to an interview with CNBC in Las Vegas on Thursday. He said that the market has priced in deregulation, and by the time actual legislation is executed, it will not be as much as "everyone thinks it is."
Still, because of the excitement in the market over things like tax cuts and loosening banking regulation, he has very little cash on the sidelines.
"We're probably today, more invested than we've ever been," said Lasry, who spoke on the sidelines of the Forbes Shook Top Advisors Summit. "Short term, we think it's all going to be positive."
Lasry, who supported Hillary Clinton in her bid to become president, said some of the deregulation being discussed could be "good for business; it may not be good for people."
The example he gave was environmental regulation, and how it will be helpful for businesses in the short term, but could make individual people worse off.
"There's a tradeoff for everything we do," he said. "And the question is who's going to be willing to make those tradeoffs."
While the U.S. stock market has risen significantly this year, Lasry said there's still "room to run" over the next year or two. He plans to reevaluate his positions once more deregulation gets enacted. His main concerns within a year include a larger budget deficit against the backdrop of rising interest rates.
Lasry also addressed some of the concerns made by Warren Buffett and others over active managed investing and the fees that hedge fund investors are willing to pay. He said the belief that a specific manager will outperform markets is why investors are willing to give that fund money, and without that outperformance, investors will take their money and put it elsewhere.
"The demise of this industry just isn't happening, because you've constantly got people who will outperform," Lasry said. "That's actually why you'll have a number of folks who will keep on growing and others who won't."
—CNBC's Karen Stern contributed to this report.