brewer12345
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
- Joined
- Mar 6, 2003
- Messages
- 18,085
Rich_in_Tampa said:I see your points. Plus the ability to pick up some sales merchandise by rebalancing when stocks are low.
I wonder whether those advantages of stocks over cash are offset by the fact that 1) cash won't go down in value even in a bull market like bonds might, and 2) by confining cash to 28% of assets (7 x 4y expenses) rather than 40% as is often done with bonds, you get to keep a larger proportion in stocks which over the long haul will probably do a lot better.
Hmmm, well, I guess if you restict yourself to bonds, stocks and cash you will have to realy contemplate all of this carefully. But it is worth remembering that there is more than those three things to invest in. Commodities, real estate, foreign bonds/currencies, "alternative" investments (VC, hedged equity vehicles, private companies, etc.), tax liens, and so on. Personally, I think that it would be foolish to stick to the stock/bond/cash matrix, especially in retirement where a wider spread of risk is very valuable.