In a long term sense, cash is the most risky asset of all Hans Kunnen Colonial First state. AFR 17/12/08
For all those saying I am better off in cash some food for thought
Exert from AFR article. Cash was King but its been dethroned. Thanks to the 50% slump in market from its peaks, the yields offersd by shares are much better than in many years. Lower interest rates which could drop even further in the new year, a weak dollar that is keeping inflation up and tax liabilities all are potential traps for those holding cash For most investors the after tax, real return is turning negative. So much for preserving capital. indeed the only justiication for holding cash over a growth asset would be through a super fund, especially an allocated pension. That at least elimates the tax problem, although its hardly a way of building wealth. "in a long term sense, cash is the most risky asset of all," says Hans Kunnen, head of investmentsmarket research Colonial First state.
I really like how a few have said they are staying in cash as they won't lose any money but this article certainly shows the light on who has there head buried in the sand, and I am not saying go out and buy property. But just posting this to promote alternitive thinking to those who think cash is or should I say was King.
