Dan Fuss, known as the Warren Buffett of bonds, said his $23 billion Loomis Sayles Bond Fund is sitting on more than 20 percent of cash and cash equivalents, its highest level ever, because he sees scant opportunities in the bond market.

"If we saw a lot of value, we wouldn't have those reserves," Fuss told Reuters in an interview.

Fuss, vice chairman and portfolio manager at Loomis Sayles, which oversaw $199.8 billion as of December 31, said the Loomis Sayles Bond portfolio has been building cash since early 2013 and has boosted levels as fixed-income securities have become increasingly pricey.

"The bond market is a bid-only market," Fuss said. "The danger in the corporate bond market is not the availability in the money. The problem is that for providing the money for an extended period of time, you don't get the same amount of protection that you used to on the lower-rated credits."

Fuss called junk bonds and corporate debt securities "high-priced."

"At the long end of corporates, the liquidity is great if you're a seller," he said. "It's non-existent if you're a buyer."

Fuss said Loomis did not participate in Greece's auction on Thursday of five-year bonds, which marked the country's return to the bond market after nearly crashing out of the euro zone two years ago. Greece sold the bonds at a yield less than 5 percent.

In 2014, the Loomis Sayles Bond Fund has posted a return of 3.42 percent, outperforming 85 percent of its peers, according to Morningstar data. Over the past 10 years, on an annualized basis it has returned 8.37 percent, surpassing 94 percent of its peers for the same period, according to Morningstar data.

For its five-year record, the Loomis Sayles Bond Fund has posted returns of 14.61 percent, ahead of 85 percent of its peers.