IT IS COSTLY TO STAY IN CASH
- Michael Livian
- Sep 10, 2014
- 1 min read
Staying in cash while waiting for the Fed to raise interest rates requires a large sacrifice in income. It’s important to remember that the losses incurred in a rate rise are mainly temporary, rather than permanent. And historically, the average price drop associated with a one-percentage-point rise in short-term interest rates has been relatively modest. For a large proportion of investors, the risk-reward tradeoff will favor keeping cash balances low and enjoying the benefits of higher income generation.
Read here the full analysis recently conducted by our Chief Investment Officer, Martin Fridson.
Comments