Key insights
- An investor expresses frustration with high valuations and the psychological difficulty of holding a large cash position while the market continues to rise. The investor is questioning their investment strategy and whether to lower their margin of safety. This reflects a broader market sentiment of stretched valuations and potential for underperformance by value-oriented strategies.
Finding a decent margin of safety lately feels almost impossible. everytime I run a screen for companies with a solid ROIC, durable moats and manageable debt, they're already trading at like 25-30x forward earnings. it's just priced to perfection I've been sitting on a ~30% cash position since late last year because I fundamentally refuse to pay these premiums for mature businesses. but honestly the mental drag of just sitting on my hands is real. most of my dry powder is just parked in SGOV getting roughly 5%, and I keep a smaller slice in edel for a little extra yield while I wait, but it still feels weirdly punishing when the broader indices just blindly grind up every single week I know the whole Graham/Buffett philosophy is that the market is a no-called-strike game and you just wait for your pitch. but what do you guys actually do when the market refuses to throw anything historically hittable for 18 months? are you guys just quietly lowering your required margin of safety to deploy capital, or actually just holding the cash and accepting the temporary underperformance? starting to question my own patience tbh.