Author Topic: Your opinion on this strategist please - stay in cash?  (Read 1087 times)

SparkyPeanut

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Your opinion on this strategist please - stay in cash?
« on: April 27, 2022, 05:30:42 PM »

Please can you give me your feedback on this strategist below.

At 9:00 is he saying near-retirees should stay in cash??

He says 40% of the Russell can't service their debt?

https://finance.yahoo.com/video/look-bond-holders-strategist-says-202652486.html?fr=sycsrp_catchall

Financial.Velociraptor

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Re: Your opinion on this strategist please - stay in cash?
« Reply #1 on: April 27, 2022, 05:56:49 PM »
A cash allocation to supplement a "large" fixed income allocation when nearing retirement always makes a lot of sense.  Betting on a near complete and permanent collapse of the US economy has always been a fool's game. 

Yes, there are a lot of "Zombie" companies out there right now (defined as not making sufficient cash returns to pay their coupons) that have inexplicably been allowed to refinance repeatedly for decades.  It isn't the megacaps that are hocked over their ears (and they will gladly attend a fire sale when the debt bubble pops).  If you are in a market cap weighted index, pick a fixed income and cash allocation that lets you sleep at night.  Then go live your life. 

shureShote

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Re: Your opinion on this strategist please - stay in cash?
« Reply #2 on: April 27, 2022, 06:36:35 PM »
Not sure it makes sense to click on these types of stories. Not really anything to analyze, itís just noise best I could tell.

As F.V said, set your plan and move on. That plan should include various things, including some cash, but not for any reason related to the story.

SparkyPeanut

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Re: Your opinion on this strategist please - stay in cash?
« Reply #3 on: April 27, 2022, 07:02:10 PM »
A cash allocation to supplement a "large" fixed income allocation when nearing retirement always makes a lot of sense.  Betting on a near complete and permanent collapse of the US economy has always been a fool's game. 

Yes, there are a lot of "Zombie" companies out there right now (defined as not making sufficient cash returns to pay their coupons) that have inexplicably been allowed to refinance repeatedly for decades.  It isn't the megacaps that are hocked over their ears (and they will gladly attend a fire sale when the debt bubble pops).  If you are in a market cap weighted index, pick a fixed income and cash allocation that lets you sleep at night.  Then go live your life.
  Ok thanks. I have a lump sum to invest (so much harder to deploy than DCAing over decades). I am looking at a Balanced portfolio 60 equities/40 cash - as I am 50. Does this sound right?  I have no idea when to buy, very unnerving.

Financial.Velociraptor

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Re: Your opinion on this strategist please - stay in cash?
« Reply #4 on: April 27, 2022, 07:51:29 PM »
A cash allocation to supplement a "large" fixed income allocation when nearing retirement always makes a lot of sense.  Betting on a near complete and permanent collapse of the US economy has always been a fool's game. 

Yes, there are a lot of "Zombie" companies out there right now (defined as not making sufficient cash returns to pay their coupons) that have inexplicably been allowed to refinance repeatedly for decades.  It isn't the megacaps that are hocked over their ears (and they will gladly attend a fire sale when the debt bubble pops).  If you are in a market cap weighted index, pick a fixed income and cash allocation that lets you sleep at night.  Then go live your life.
  Ok thanks. I have a lump sum to invest (so much harder to deploy than DCAing over decades). I am looking at a Balanced portfolio 60 equities/40 cash - as I am 50. Does this sound right?  I have no idea when to buy, very unnerving.

That isn't enough data to make a "good" recommendation.  You should do a case study.  https://forum.mrmoneymustache.com/case-studies/how-to-write-a-'case-study'-topic/

FLBiker

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Re: Your opinion on this strategist please - stay in cash?
« Reply #5 on: April 28, 2022, 07:13:49 AM »
I agree that a case study would be helpful, but in a vacuum, 60/40 at age 50 seems reasonable.  It's conservative for my taste, but I'm not you.  I'm 45, near FI, and we're 80/20 (with that 20 split between bonds and cash).

SparkyPeanut

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Re: Your opinion on this strategist please - stay in cash?
« Reply #6 on: April 28, 2022, 05:10:42 PM »
I agree that a case study would be helpful, but in a vacuum, 60/40 at age 50 seems reasonable.  It's conservative for my taste, but I'm not you.  I'm 45, near FI, and we're 80/20 (with that 20 split between bonds and cash).

Thanks