Cash is trash. You hear that phrase often these days as the yield on money market instruments hovers around 0%. With interest rates pinned so low it has behooved investors to shift from cash into higher yielding assets. Even in the best of times cash equivalents, after inflation and taxes, just about hold their value. However cash can act as a strategic asset at times. In periods of high inflation cash has historically been a decent hiding place. In addition, when you are waiting for high-conviction ideas to reveal themselves cash can as a waiting room. In today’s screencast a look at cash as a strategic asset.
Items mentioned in the above screencast:
In defense of cash. (FT Alphaville)
Don’t fight the Fed, illustrated. (AR Screencast)
“Everyone wants a new stock pick each day. But sometimes the best pick is to move toward cash and evaluate to protect your capital.” (@TraderFlorida)