I think cash is under rated as there is a "lost opportunity" cost (impossible to measure) instead of the known comparison cost of competing investments.
I'll add some comments regarding this and your father's desire to be fully-invested, i.e. don't hold cash.
If this is so: When there's nothing to buy, don't buy anything
then is this a corollary: When there's something to buy, buy it.?
I like that second part.
I grant that we all have different interests, risk profiles, and experiences. For me, I believe my greatest errors and greatest regrets are from "lost opportunities" --- failure to buy when I coulda/shoulda.
Yeah, I sure regret buying too much of something and seeing it drop in value (MMT.v/MAUXF being a current one) or conversely, seeing something, buying it, but not having the courage in advance to take any kind of substantial position and subsequently seeing the stock go up ... and up... and up. I've got some of those too. Still, I say my biggest regret is and has been, not buying, not even a tiny bit for a tiny taste, of something when I had the opportunity, knowledge, judgment or hunch or something to do so, but didn't. So that's why, for me, if I see something that looks like it ought to be bought, I try to encourage myself to make some commitment to it then and there -- at least for a little amount, and not cock around waiting for better prices or more favorable macro events or something. In past, I've done that rather than hold cash. Right now, like several people here, maybe including you, we hold more cash than we see opportunities to pounce. |
