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If your cash position is a one-time thing that’s fine I guess, but if you’ve been saying that for a few years (most people in that position do, not saying it’s
by deanmoriarty 6y ago
If your cash position is a one-time thing that’s fine I guess, but if you’ve been saying that for a few years (most people in that position do, not saying it’s you) then you’ve been losing a lot.
I’ve been constantly invested in index funds for 10+ years, never sold a position, including before/after March 2020. Some positions I have are up more than 200%. A crash of 50% won’t do me too much damage, I’ll still be way, way far ahead of the many friends I have who have been in cash since 2015, repeating your same “a correction is likely, I’ll wait for the bottom to get in”.
- jtdev 6y agoI have a similar approach: I typically have ~60% of net worth invested across index funds and tech growth stocks. But I’ve been building my cash position in recent months mostly via sale of said index funds and growth stocks (I was able to dodge the downturn in tech stocks in recent weeks), but also by simply banking funds that would otherwise have been put directly into equities. Now I’m reluctant to reinvest as I see significant risk in the market short term. I don’t intend to remain on the sidelines. I’m beginning to question the maxim that “you can’t time the market”... sure, you’re unlikely to time the exact top or bottom, but an approximation can result in significant risk reduction and/or upside.