Alex Gurevich, CIO of HonTe Investments, recently wrote a Tumblr post addressing the journey that cash has made as an investment since the Financial Crisis. With the S&P 500 making new all-time highs, some investors are growing leery of the stock market’s lofty valuation.
How 'Safe' Is Cash?
Gurevich pointed out that his belief in sitting out market bubbles rather than trying to trade them may seem to be in line with the idea of rotating to cash. However, he pointed out that this type of thinking is based on the premise that cash is a safe alternative to stocks.
According to Gurevich, cash is unsafe in three ways:
- Base currency risk
- Risk relative to benchmark
- Relative currency underperformance risk compared to ...
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