Those Other Two Asset Classes: Fixed Income and Cash
Although this is a book about investing in stocks, it is impossible to talk about portfolios and asset allocation without touching on fixed income and cash. Making good decisions about these two asset classes is important to your success. They both play a role in the balance between risk and reward.
Why Include Cash?
Cash is included as an asset class because it is the steadiest and most liquid of all investment vehicles. That may seem obvious, but running short of cash in your investment portfolio may mean scrambling to pay for an opportunity you identify that works for your strategy (not a tip from your neighbor on a hot stock). For example, a stock you have been watching for some time finally ...