What percentage of my total liquid assets should be in cash right now? | TigerDroppings.com

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baybeefeetz
the now
Member since Sep 2009
13963 posts

What percentage of my total liquid assets should be in cash right now?


I am in my mid-thirties. For round numbers, use a total figure of $500k.








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cwill
New Orleans Saints Fan
Member since Jan 2005
24534 posts

re: What percentage of my total liquid assets should be in cash right now?


I have about 24% of my $ in cash currently...not my standard practice but just where I am...usually the only ready cash I've had on hand is my checking account.





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OnTheBrink
Alabama Fan
TN
Member since Mar 2012
3651 posts

re: What percentage of my total liquid assets should be in cash right now?


I noticed the other day a well-respected poster here said he was 70% cash. So using your figure, about $350k cash.

Granted, I do not believe he is in his mid-thirties. I am not sure how that would skew the numbers.

ETA: This thread may help



This post was edited on 3/8 at 9:46 am


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Meauxjeaux
Memphis Fan
I have 89,275 posts with my alters
Member since Jun 2005
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re: What percentage of my total liquid assets should be in cash right now?


I heard an interesting talk on the radio the other day... one of those local money shows.

The guy said, when does 30 + 43 = 0?

His point was, if you have $100k in the market and lose 30%, you have to make a return of 43% on the remaining $70k in order to get back to even.

His point? Don't lose money. Should be the #1 goal of any investor that has a decent portfolio built up.




This post was edited on 3/8 at 9:56 am


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foshizzle
LSU Fan
Washington DC metro
Member since Mar 2008
29951 posts

re: What percentage of my total liquid assets should be in cash right now?


Other than for my everyday checking account needs I have $0 in cash.

However, I have a very wide-ranging mix of investments, a downturn in US equities shouldn't hurt all that much. And yes, I've been careful to invest in areas that tend to have low covariance in returns. For example, although I do have some non-US equity assets I deliberately picked a non-dollar hedged version to reduce the covariance with US equities and introduce foreign currency risk without actually getting into the forex market myself. The fund can do that less expensively than I can.






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LSURussian
LSU Fan
Baton Rouge
Member since Feb 2005
81066 posts

re: What percentage of my total liquid assets should be in cash right now?


quote:

said he was 70% cash.
If you're referring to me (I'm not sure about the "well respected" part) my 70% cash ratio is for my trading portfolio, not my "permanent" stock investments portfolio. For those portfolios my favorite holding period is just like Warren Buffett's stated favorite holding period.....FOREVER.

If I include all of my stock portfolios I'm only about 40% cash now.






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baybeefeetz
the now
Member since Sep 2009
13963 posts

re: What percentage of my total liquid assets should be in cash right now?


Right now we are at about 50%. Have been for a while. Too scared to invest more, because we lost a bunch of money in the big crash, and we lost a bunch of money on a condo.







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matthew25
Ole Miss Fan
Member since Jun 2012
3395 posts

re: What percentage of my total liquid assets should be in cash right now?


One of the investment guru's on Fox last week stated this formula:

55% stocks, 35% bonds, 10% cash.

I am shooting for 65/25/10.






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foshizzle
LSU Fan
Washington DC metro
Member since Mar 2008
29951 posts

re: What percentage of my total liquid assets should be in cash right now?


quote:

we lost a bunch of money in the big crash


Sold early, huh?






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wiltznucs
South Florida Fan
Apollo Beach, FL
Member since Sep 2005
7696 posts

re: What percentage of my total liquid assets should be in cash right now?


I'm 35 and of the buy and hold mentality. I believe that cash is a depreciating asset if not invested. I didnt change my positions at all and kept buying during the decline. I am now as I was then only about 5% in Bonds/Cash.


This post was edited on 3/8 at 1:11 pm


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ThaBigFella
LSU Fan
baton rouge
Member since Apr 2006
2043 posts

re: What percentage of my total liquid assets should be in cash right now?


Agree why would anyone wanna hold cash when it's devaluing by the day...buy an hold and reinvest dividends nobody has ever had less over a 20 year period doing so....need cash for other deals, great use a stock loan or don't invest money you may need....I've owned Altria stock since I was 15, my uncle bought it for me along with coke and xom....I'm 34 now and my $1000 gift is now close to $23,000 and has a 2,200% return.....trading stocks and timing the market is a fools game....buy and hold solid companies and just buy more during crashes or corrections And that includes tech bubble crash,sept 11,and market crash 4 years ago....and still 2200% from a blue chip in 18 years...the coke and Exxon shares did well too just not at much



This post was edited on 3/8 at 1:33 pm


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Zach
LSU Fan
Member since May 2005
63771 posts

re: What percentage of my total liquid assets should be in cash right now?


I have...

45% in stocks that I manage myself.
35% in a mutual fund with a manager.
20% in cash.

The only bonds are within the mutual fund mix.

I have no idea if this is a wise combination. It's just what I do.








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matthew25
Ole Miss Fan
Member since Jun 2012
3395 posts

re: What percentage of my total liquid assets should be in cash right now?


Back to the OP. I enjoyed an article dated Jan 23 by Christine Benz - A Sample Retirement Portfolio in 3 Buckets - for a retired married couple with $1.5Million assets.

She recommends $120K in CD's/money market/other cash. Equates to 8% cash holding.

Also recommends: $450k in VIG (VDAIX); $200k in both VTI and VEU; and $200K in PIMCO Tot. Return E:BOND. The amounts can be adjusted for larger or smaller asset pools






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