Cash as Asset Allocation ?

I think one important factor is the person's age.

A young investor in his 20s or 30s can afford to be fully-vested bcos he still has many years of working and investing ahead of him.

However, an old investor in his 60s or 70s probably want to have more cash on hand.

(16-01-2014, 03:13 PM)corydorus Wrote: Cash level is heavily dependent on individuals. Cannot applied the same to anyone else you may lose confidences easily and make wrong decision in haste.

For me right now is more than 50% cash. Thats my comfort zone that i will held stock or invest more when crisis or opportunity arises.

So my take is to invest up to the maximum level of your affordable zone mentally and practically.

Well put. To each his own comfortable level. Good night and sleep well my friend.
"Tin di lou li, tong peh kam", Cantonese's saying. Literally translation - "The whole sky fallen, take it as a blanket cover."
Another words you have made provision for protection even in the worse case. At least you won't die.

Cash is king

(16-01-2014, 04:52 PM)Temperament Wrote:

(16-01-2014, 03:13 PM)corydorus Wrote: Cash level is heavily dependent on individuals. Cannot applied the same to anyone else you may lose confidences easily and make wrong decision in haste.

For me right now is more than 50% cash. Thats my comfort zone that i will held stock or invest more when crisis or opportunity arises.

So my take is to invest up to the maximum level of your affordable zone mentally and practically.

Well put. To each his own comfortable level. Good night and sleep well my friend.
"Tin di lou li, tong peh kam", Cantonese's saying. Literally translation - "The whole sky fallen, take it as a blanket cover."
Another words you have made provision for protection even in the worse case. At least you won't die.

actually cash is king can also refer to cash flow is king

i am like corydorus, currently >50% cash. No point wait long time for crash and no money to buy in when it crashed. You can get SUPER VALUE counter, some even the share price less than the net cash (that is my version of NET NET NET company)

How to know market is low? when index >40% off high and when everyone saying cannot buy lah and very little volume done and if you spy on your remisier is trying to swat the fly at the kopitiam whilst he is having his 3rd teh peng break for the day....

(01-02-2014, 12:22 PM)tikam buddy Wrote: Cash is king

(16-01-2014, 04:52 PM)Temperament Wrote:

(16-01-2014, 03:13 PM)corydorus Wrote: Cash level is heavily dependent on individuals. Cannot applied the same to anyone else you may lose confidences easily and make wrong decision in haste.

For me right now is more than 50% cash. Thats my comfort zone that i will held stock or invest more when crisis or opportunity arises.

So my take is to invest up to the maximum level of your affordable zone mentally and practically.

Well put. To each his own comfortable level. Good night and sleep well my friend.
"Tin di lou li, tong peh kam", Cantonese's saying. Literally translation - "The whole sky fallen, take it as a blanket cover."
Another words you have made provision for protection even in the worse case. At least you won't die.

80% vested in stocks and 20% emergency cash. It's not easy but I force myself to set aside this ratio every month for a major correction. It's always tempting to use up all the funds when I see a counter drop even slightly. Thus I split the emergency cash funds among 4 different banks. I also didn't link it to my Standard Chartered trading account so that it's more troublesome for me to channel the money.

90% vested 10% cash

I just like to stay mostly vested so that I can keep collecting dividends

will probably use up my cash if STI comes below 3000

(02-02-2014, 09:24 AM)felixleong Wrote: 90% vested 10% cash

I just like to stay mostly vested so that I can keep collecting dividends

will probably use up my cash if STI comes below 3000

It's actually quite a good idea. Stay invested to collect dividends. And if your portfolio is large enough, the dividends collected may be more than enough to cover your yearly expenses. If it is so, most probably your capital invested in the stock market doesn't matters to your cash flow anymore. (aka you have other assets generating income too). You will be able to preserve your investing capital for legacy and meanwhile you feel most probably you will not run out of money before you run out of life.--Another words you are FF.
NB:
It's only one oldman's dream.
Your dream may be different.

at the moment, cash constitutes less than 5% of my entire portfolio.

my equities investment is rolled-on year after year, vested in companies which pay out dividends on year after year with characteristics of raising dividends over time. I stay focused on increasing my cash flow over time, both ready to reinvest into the same companies or into other companies which share similar characteristics, after having done thorough risk assessments, including visual inspection of physical properties or products wherever possible.

Every dollar that I place into each company, I need to know exactly what value I am paying that dollar for. Value in terms of both safety margin at the point of entry as well as the likelihood of that dollar turning into two within a period of time through the principles of compoundation, taking close view of the past decade of performance and assessing the likelihood of it repeating this performance into the next.

I believe at the current moment, it is starting to provide pockets of possible buying opportunities which fit my criteria.

my cash is in premier banking accounts, for emergency use and to save me time as I need not join the long normal banking queues. this is very time saving especially during cny, when I can "cut queue" and change new notes without much hassle.

wishing fellow forumers : gong xi fa cai !!!

gautam

It will be interesting to poll for the various answers again, let's say when the STI is at a level of 2,500?

There is nothing better than a bear market to expose our risk-management, conviction and TRUE temperament.

(02-02-2014, 06:06 PM)weijian Wrote: It will be interesting to poll for the various answers again, let's say when the STI is at a level of 2,500?

There is nothing better than a bear market to expose our risk-management, conviction and TRUE temperament.

Ha! Ha!
If you are not prepared "all the time", when the time comes, you are just "finished".

What did AE say?
"Imagination is more important than knowledge", i think applies here.
Even after i say this, it's of no use to anyone who has not gone through at least 1 bear market. 2 will be better. And still survive.

Because you can't imagine you are not prepared (in theory) after you have the knowledge. So if you can "imagine" after you have the knowledge then you will be ready for the bear market.
So what is exactly imagination in this case of the bear market?
Don't ask me.
We all have different imaginations
In fact, no one reacts to things as they are but to one's own mental images.(IMAGINATIONS HUH?)