Asset Allocation - Percentage in Cash?

[RetireJapan]

It would take a Pandemic 2 - Electric Boogaloo... I will knock on some wood just to be sure.

I think it wouldn't take much more than everyone realising this isn't going to be over easily with some vaccine. Then the dominoes come tumbling down.

Doesn't change my long-term strategy thankfully.

[RetireJapan]

Not sure the younger generation would accept any lockdown again so this very well may move from a health to a social disaster.

But since money is now magic I am sure our leaders will calm any unrest with a flow of money.

Till money itself is finally worthless and our cash allocation does not really matter anymore.

It's interesting because there are so many moving pieces, no one knows anything, and everything could have changed.

From my wife's business (is it viable anymore? We don't know!) to society (will people's behaviour change permanently?) to the health consequences (are there long-term disabilities for people that survive the virus) to the science (will there be a vaccine? Will we need a new one every year?) to the stock market (how many companies are no longer viable? Which ones are they?).

Interesting times for sure. As I don't know anything I am planning to keep doing the same thing and try not to worry about it too much.

[RetireJapan]

Very much in denial. I don't know many people that are thinking everything has changed (and I suspect it has).

But I could be wrong and this could just be a hiccup. It's possible everything will be as it was next year.

[captainspoke]

Unfortunately, one of the people most in denial is running the US...

[Kanto]

It would take a Pandemic 2 - Electric Boogaloo... I will knock on some wood just to be sure.

I think it wouldn't take much more than everyone realizing this isn't going to be over easily with some vaccine. Then the dominoes come tumbling down.

Doesn't change my long-term strategy thankfully.

I see what you're saying, but if VT was down 75% most likely our investments will not be on our minds at all. Rather, we will be preoccupied with the world being on fire.

I have decided to be optimistic about things. I have absolutely no good defence for taking that stance, I just am tired of being so pessimistic.

I am holding for 20+ years, so I am not too stressed either way.

[RetireJapan]

I see what you're saying, but if VT was down 75% most likely our investments will not be on our minds at all. Rather, we will be preoccupied with the world being on fire.

Much like the stock market can be up even though the world economy has gone to hell (hello 2020), I suspect the stock market can collapse without burning the world down. But I may be wrong about that too!

[Kanto]

I see what you're saying, but if VT was down 75% most likely our investments will not be on our minds at all. Rather, we will be preoccupied with the world being on fire.

Much like the stock market can be up even though the world economy has gone to hell (hello 2020), I suspect the stock market can collapse without burning the world down. But I may be wrong about that too!

I did not see April as a collapse, just a large dip. A 75% drop in global markets, as you stated, now that is a collapse!

Now if you want to talk about bloated tech stocks, then we can talk about a threat of collapse!

[eyeswideshut]

I am about 25% cash right now - my wife is probably more like 50%. I am (foolishly no doubt) hoping for a drop in stock prices over the next few months which is why I am stockpiling cash after buying a fair bit in March and April. I only wish I had bought more during that drop but the rapid recovery took me off guard so I stopped purchasing in May. Current valuations seem excessive given that most of the world will likely be going into or has already entered a recession. If stock prices don't fall over the next few months I will probably put a chunk of that cash towards my mortgages.

[Kanto]

I am about 25% cash right now - my wife is probably more like 50%. I am (foolishly no doubt) hoping for a drop in stock prices over the next few months which is why I am stockpiling cash after buying a fair bit in March and April. I only wish I had bought more during that drop but the rapid recovery took me off guard so I stopped purchasing in May. Current valuations seem excessive given that most of the world will likely be going into or has already entered a recession. If stock prices don't fall over the next few months I will probably put a chunk of that cash towards my mortgages.

There is some research on dollar-cost averaging. I cannot find the exact studies.

https://investor.vanguard.com/investing ... t-lump-sum

Basically, now is almost always better than waiting.

The old .. Time in the market>Timing the market.

[robster]

Unfortunately, one of the people most in denial is running the US...

possible typo? you meant "ruining", right?