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/biz/ - Business & Finance

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51062345 No.51062345 [Reply] [Original]

My parents sold the top in November with all of their investments and are still all 100% in cash.

I cant believe holding cash for nearly an entire year has been the best investing strategy. I wonder how much longer this will go on for, it seems like the rally in the global markets has just finished, and its going to start going down again for the next few months again..

>> No.51062370

>>51062345
yeah but then you'll be able to buy for elite profits

>> No.51062417
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51062417

>>51062345
You never seen this before?

>> No.51062422

Based OP's parents. Even if you were all in on something, it is worth having a cash position so you can obtain more of the thing you want in the event price goes down. It has absolutely nothing to do with giving up or not believing in said thing, rather it has everything to do with the economic law of marginal utility.
>go from 100 Bitcoin to 101 Bitcoin is 1% difference
>keeping 1 Bitcoin as dollars in event of 66% drop
>can now acquire 3 Bitcoin
>essentially sacrificing 1 Bitcoin for a chance to make 3 in this basic scenario

>> No.51062424

>>51062370
I dont even know if my parents plan on reinvesting anytime soon

They looked at the indices and saw that it looks like a massive bubble, and that at their age (late 60s) that if the markets in the next 1-5 years crashed 50%, that they dont want to see their portfolios be down by half, because god knows how long it would take for it to recover if there was a 50% major crash in all the markets.... they are worried that if it happens, they may end up getting to their late 70s (early 2030s) by the time their investments went back to as much as they were in the early 2020s.

>> No.51062472

>>51062417
Yeah, thats happening, but if youre holding assets that are dumping and or going to crash significantly, you're getting double fucked, the idea that asset only go up is due recency bias of the last ~14 years of growth, perhaps my parents age and experience with previous crashes/recessions is why they sold the top in November and remain in cash still, they still dont think its anywhere near over with.

Like I said, when they sold in November 2021, they believe a -50% crash from the November 2021 top is going to occur in the next 1-5 years