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This is the difficulty with being in a lot of cash- what do you do with it?

I am in the same position having moved most of my money out of the market in the middle of the crash. Right now the DJIA is still beneath where I pulled out. But it is steadily rising to where I pulled out and then I will be "behind" if I am not in the market. Hmmm what to do?

I decided to "dollar cost average" back in and moved about 25% into the market a month or so ago. I am not sure when I will move the rest in because I believe both stories (going up, or going down) but will dollar cost average in a little new money. I'll dollar cost average in a little more but am sure I'll get burned.

However, accepting that I can't make the absolute best decision, it is okay to accept a reasonable decision. Part of that decision is recognition I'll be investing in the future and my decisions right now for specific cash will eventually be dwarfed by future investments coming from income. (Presuming I have a job of course).

But this leaves me in the predicament- in the future when this happens again and I am not earning an income, what would be the correct course of action?

Or for that matter, what is the correct course of action at this moment?

I just read an article which suggested that splitting assets among CD's, stocks, bonds, real estate, and cash left the happiest investors according to happiness meters. I don't own any CD's and only own bonds through mutual funds. I own no real estate. So I am thinking of laddering some CD's, picking up a few bonds, and investigating buying a piece of property at record low interest rates with the idea of being able to meet mortgage payments.

My intention was with my equity investing to have uncorrelated asset classes, but the reality was that they were highly correlated except for the cash and my house which didn't get nailed as hard as a lot of housing markets.

So my recommendation is: look for truly uncorrelated asset classes and invest between them in this highly uncertain macroeconomic situation. A few TIPS would be good too.
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