Videos | SFA
16 June 2025
Perspectives on the equity market and cash holdings
Published on 16.06.2025 CEST
- Equity markets have experienced significant volatility in recent months, and this pattern could continue, depending on evolving macroeconomic and geopolitical developments. Regional performance has varied notably this year. Europe and Switzerland, for example, have shown relative strength, supported by policy dynamics, an investor sentiment shift, and valuation differentials.
- Increased market uncertainty has led some investors to raise their cash holdings. While holding cash can offer liquidity and flexibility, it has historically provided limited downside protection during equity market drawdowns. Over full market cycles, cash has typically underperformed other asset classes such as high-quality bonds.
- From a strategic perspective, cash allocations are best evaluated within the context of a diversified and long-term investment plan that reflects individual liquidity needs return goals. In the current environment, fixed income assets – particularly high-quality, longer-duration bonds – may offer more attractive characteristics relative to cash based on current yields and interest rate conditions.
Published on 16.06.2025 CEST