Our cash balance increases every month but its proportion of our total assets remains the same at 50%. It’s a drag on our asset portfolio return but we are okay with it since we are not in a rush to chase for higher returns. But we do keep a look out for opportunities to invest some of this cash.
And it looks like one has arisen. The recent Wuhan Coronavirus Crisis has caused a market sell-off. We have been slowly transferring cash funds into our StashAway robo-advisor accounts to be invested. My wife has also been topping up her DBS DigiPortfolio – Asia and Global Portfolios for investing.
Just a little at a time to buy into the market dip. We have no idea whether it will worsen and by how much. If the market does keep dropping, we will probably make larger cash funds transfers to be invested. This is a good way to value average our investments in the StashAway robo-advisor accounts and DBS DigiPortfolio – Asia and Global Portfolios.
We haven’t made much manual investments yet because that’s only activated when the market fall is significant enough for us to take action ourselves. This is when we invest the largest sums of money to make it worthwhile for us to step in and make manual investments.
We hope to utilise some of the cash balance since it has been sitting there for quite a while. Since we are still earning salary income every month, we can rebuild the cash balance in time. The important thing is to deploy the cash efficiently and effectively when there are opportunities.
It would be nice to sit on an ever growing cash pile even when you are investing some of it. Since it takes away the stress of having to find ways to utilise it. And we can spend it on what we want. Which can be things like travel, gifts, dining and entertainment. Doesn’t always have to be investments.