Mark Cuban reveals his wild card, having a significant portion of his portfolio in cash.
Being liquid when others are strapped for cash when most are leveraged to the hilt and forced to sell in a downward market due to margin calls or mortgage defaults, means those with available cash can pick up bargains.
Mark Cuban noted that he can seize opportunities rapidly without hesitation when he has cash. Mark Cuban’s strategy is almost identical to that of billionaire investor Warren Buffett, whose investment mantra is to “be greedy when others are fearful.”
Buffett has maintained a substantial cash reserve.
In December 2024, Buffett’s Berkshire Hathaway had $325 billion in cash.
Billionaire investor and entrepreneur Mark Cuban is well known for making significant deals in the corporate world.
But, when Mark Cuban manages his private portfolio, he also likes keeping a sizable portion in cash.
“Mark Cuban reveals his wild card, having a significant portion of his portfolio in cash”
WEALTH TRAINING COMPANY
In the predatory nature of investing cash is the weapon, Mark Cuban reveals his wild card
In this type of investing, bargain hunting is similar to a wild cat up a tree waiting patiently for the right moment to pounce on his meal.
It is the primal predatory nature of investing, being able to act fast and strike at undervalued stocks or other high-growth opportunities without needing to sell anything else.
If you don’t have cash to hand in a down market and are forced to sell assets to raise money to buy discounts, that would defeat the purpose.
Mark Cuban reveals his wild card, staying on the sidelines during volatility
Investors know that markets can sometimes be volatile, so Mark Cuban stores an adequate level of cash to ride out the volatility.
For example, Nvidia recently made records by plunging sharply, down 17% and slashing $600 billion in market cap within a day.
It was the worst single fall in stock in just one day.
“Nvidia recently made records by plunging sharply, down 17% and slashing $600 billion in market cap within a day”
WEALTH TRAINING COMPANY
There is a story about a British investor who did excellent research in 2019, where he accurately forecasted that Nvidia would be a winner in the technology revolution.
So, the investor bet his entire savings of 100,000 GBP and took a highly leveraged position in Nvidia.
What then followed was the 2020 black swan event, the pandemic lockdowns, and a stock market crash.
The stock price moved against the investor’s position, and his broker requested a margin call, but he had no more cash, and the position was liquidated, with the investor losing all his capital.
It is a sad story because if he had not used leverage and had the cash to wait out the market turmoil, his investment today would be worth north of four million USD.
“Cash is also needed to build funds for unexpected expenses that can happen in life, such as car repair, medical expenses, and fixing a leaking roof”
– Wealth Training Company
Mark Cuban reveals his wild card cash for an emergency fund
Cash is also needed to build funds for unexpected expenses that can happen in life, such as car repair, medical expenses, and fixing a leaking roof.
Mark Cuban recommends that people have cash to cover three to six months of expenses if something doesn’t go right.
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