I hold 50%+ of my net worth in cash. Fund managers would cringe at that portfolio weighting. What about inflation? Opportunity cost? Well, there are 2 reasons (which are very specific to me and my goals): 1. In our industry (and in private equity - where I have an increasing focus), you need liquidity to go big when there's a strong +EV opportunity. You don't want to be forced to sell a risk-asset at the wrong time to fund a better opportunity. 2. I could park my money in the S&P500 and get 10% a year, or I could park in T-bills at 4.3%, and have the freedom to inject money into my businesses/building new products as I see fit. If I'm over allocated to risk assets, and there is an opportunity to grow my business, once again - I may be forced to sell at an inopportune time. These 2 factors are very individualised to my situation, so the average person probably shouldn't follow this strategy. However, there is something to be said for spending more money investing in yourself vs the markets. We've been conditioned to thinking investing is the key to wealth - but it's really your income.