Once you have formed your investment portfolio, regardless of your risk appetite and the composition of this portfolio, it is a good idea to leave some money free.
The level of your cache (funds that are in your account, but not placed in assets, that is, simply, cash) should be kept in the range of 5 to 15% of the total portfolio value.
At first glance, it’s rather strange to just keep money that is not used, because they don’t work, they don’t make a profit, they just hang out dead and inflation slowly consumes them. But this is only at first glance. Let's see why we need a free cache.
The funds that are in your account, but not placed in assets, are actually designed for short-term operations - from one day to several weeks.
In the market, sometimes there are very interesting opportunities for short-term trading, the profitability of which can be 5-30% in just a few days. But this is quite a rare event.
Therefore, the market position does not always allow to withdraw funds from the portfolio assets. Moreover, intervening in a portfolio without any particular reason only hurts - you break the balance of the scales and the integrity of the portfolio. In addition, you can skip the next dividend payment. And the easiest way to not miss such rare, but profitable opportunities, you just need to have a cache in your portfolio.
In addition, there are often unforeseen events that lead to a significant drop in prices for a particular instrument that you have in your portfolio or in the tracking list for purchase. As long as you invest the next batch of money, the opportunity may simply disappear. And using the cache, you will be able to instantly react to the changed situation - in time to buy an instrument, which you have been looking at for a long time, or just add stocks that have sunk heavily and are already beginning to unfold again in growth.
Personally, I always have some cache for similar cases. Periodically, I add heavily sagging stocks. Recently, for example, golos, a cryptocurrency in which I have been investing lately, has sunk very badly. And at the very bottom I was able to purchase very successfully, precisely because I keep some cache reserves.
I believe that this is almost a grail approach and a cache reserve, at least in 5% of the investment you should have. By the way, if you are greatly disturbed by the fact that this money is a dead weight, I will give you simple and obvious advice (which, for some reason, does not want to come to many in the head). The advice is this: open the sites of your banks, study their proposals for opening demand deposits or with partial withdrawals.
Choose the most favorable conditions - at the moment there are a lot of similar deposits with an income of over 7% per annum and interest on a monthly basis. This is exactly what you need. Thus, your cache will not be idle, making a profit all the time.
