09-01-2013, 05:32 PM
I'm not really sure how to calculate my percentage cash, simply because it is spread out across different accounts, and some of it is not earmarked for investment, but could be used that way if we had a serious drop in prices that creates an irresistible buying opportunity.
That said, I suspect I have waaaay more cash than is advisable. And Horace's post puts the cost of being under-invested in good perspective.
But, you also have to be able to sleep at night, and having a lot of cash makes me feel secure. And I am fortunate to have a little excess from income to be able to put into stocks each month. So my percentage cash may drift lower very slowly over time, barring any extreme market moves. But I do like very much the flexibility that excess cash gives me no matter what happens.
That said, I suspect I have waaaay more cash than is advisable. And Horace's post puts the cost of being under-invested in good perspective.
But, you also have to be able to sleep at night, and having a lot of cash makes me feel secure. And I am fortunate to have a little excess from income to be able to put into stocks each month. So my percentage cash may drift lower very slowly over time, barring any extreme market moves. But I do like very much the flexibility that excess cash gives me no matter what happens.