Nervous investors beware: If you're seeking some shelter from market volatility, fleeing stocks for cash could put a dent in your long-term savings goals.
With that said, worried investors may decide to "go to cash." So, what exactly does that entail?
A cash investment is basically a short-term obligation, usually about 90 days. It provides a return in the form of interest payments. Cash investments generally offer a low return compared to other investments. They are also associated with very low levels of risk and are often Federal Deposit Insurance Corp-insured.
Financial experts urge investors not to act without a plan. Advisors say you should not change your current investment strategy if it was well thought out to begin with.
Of course, the market roller coaster ride may have investors thinking of some safe havens. The Dow Jones Industrial Average fell by more than 400 points Thursday afternoon.