In light of the equity market weakness sweeping the world it is not surprising to see a slew of articles touting the benefits of asset classes that are not equity-related. A recent survey shows that wealthy investors are becoming ever more comfortable in holding cash equivalents.

Michael Mandel at BusinessWeek wonders where investors can turn in light of the perception that so many different asset classes seem to be experiencing a bubble simultaneously. Aside from simply fleeing to cash the other option he describes as "radical diversification",

…the aggressive spreading of investments across sectors and regions. It has the advantage of ensuring that if a bubble bursts in one market, it affects only a small portion of an investor's assets.

Market Participant at Seeking Alpha notes the challenges in diversifying in a highly correlated world. The currently high correlations between domestic equities, developed market equities and the emerging markets force investors looking for diversification opportunities to look at bonds including TIPs.

Simon Constable at TheStreet.com examines the relatively poor performance of TIPs this year despite the rising fear of inflation. TIPs are in practice a more aggressive approach than simply holding cash. At some point TIPs will being to look attractive to investors fleeing riskier asset classes.

Karen Wallace at Morningstar.com examines the case for commodities as a portfolio diversifier. The bottom line being in small doses and held with a long time horizon in mind.

James Picerno at the Capital Spectator notes the surprisingly strong performance of REITs over the past few years, but still (rightfully) cautions investors to re-balance their portfolios to maintain proper diversification.

Tim Middleton at MSN Money examines the different ways investors stash their cash, including CDs, Treasuries, and money market funds.

While no one can rightfully claim cash as 'radical diversification' it is a viable short-term strategy in a time of uncertainty. The challenge for investors is that cash can serve as a proverbial roach motel. It is easy to check into, but difficult to check out. Investors who flee to cash equivalents need to have a plan in place to re-invest that cash into risky assets when conditions warrant.