Tag Archives: cash

Cash – the ultimate diversification tool

Cash is the best asset class for diversifying your portfolio. This goes against a lot of the traditional investment advice which most of the time recommends bonds as the diversifying asset class. This is particularly true for retirement portfolios. In this post I want to take a look at bonds vs cash as a diversification tool. Diversification is often touted as the only free lunch in investing. The basic principle is that you want to allocate portions of your portfolio to asset classes that ideally move inversely to each other (negatively correlated), i.e if one asset class has positive returns, … Continue reading

Posted in Bonds, Portfolio, Retirement | Tagged , , , , | 5 Comments