Cash is an option on every asset class

The impact of history’s greatest monetary experiment is now upon us. Low interest rates, flat yield curves and the pursuit of yield have rendered it difficult for value investors to find interesting new opportunities. In this environment, I’d suggest building up some cash. Cash is like an option over every asset class, with no expiration date and no strike price. Cash provides the option to sweep up a bargain when it becomes available, and this must have some value above the fact it earns almost nothing. If the purpose of an investment portfolio is to grow as well as protect the wealth you’ve accumulated over the years, doesn’t it make sense, if you can afford it, to also hold an option? At this juncture, there is value in holding some cash. Not most of your money, but some. Read the full story on our blog: (VIEW LINK)