MICHEL PIREU: Affluent investors hold onto their cash piles during trying times
In 2009 I took a piece of advice from a close friend that the market was too high and that I should go to cash and wait for a correction. Years later, I am still waiting and have missed record highs. How dumb is that? — Anon, January 2018. The answer to that question seemed clearer last month than it did last week, when the markets finally took a turn for the worse. In hindsight, sitting in cash waiting for a correction wasn’t the smartest thing you could have done over the past few years, but that’s with the benefit of hindsight. Sitting on the sidelines when it seems the right thing to do isn’t necessarily the poor decision it’s so often made out to be. At the end of last year, Warren Buffett was reportedly sitting on a cash pile of more than $100bn. "I strongly believe that Buffett will sit on it for a prolonged period," said Paul Koger of Foxy Trades. "He has firmly stated that the markets are priced at levels that are beyond reasonable valuations. And as his main strategy is to...
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