Ask Colin

What is the best way to invest cash reserves if the stock market is not providing opportunities?

The cash issue was dealt with in Free Newsletter 77 – you can search that page in the usual way with Ctrl+F – “cash” found two articles. 

I have made the mistake in the past of tying up my cash reserves in ESANDA debentures (18% at the time). However, the stock market turned up much earlier than I had anticipated, so I was locked in for a few years. 18% sounds a lot, but the inflation rate than was very high.

 If I wanted to tie up cash to get a better yield, I have considered a series of short-term term deposits so they are rolling over every month. However, I prefer to be even more flexible, because I have learned that it is impossible to forecast the stock market. However, you might make a different decision for your investment plan.