Please stay tuned for important disclosure information at the conclusion of this episode.

Welcome to Investing Insights. I'm your host, I Vanne Hampton. There's a tug-of-war between investing in

cash and long-duration bonds in today's interest rate environment. The longer end of the

yield curve may look more appealing, since anticipation is building about interest rate cut.

Morningstar's economics team and market watchers are predicting the Federal Reserve will lower

rates more than once in the final months of 2025. What may matter more is the time horizon for your financial goals.

Morningstar Inc. portfolio strategist Amy Arnott has examined why for some investors.

Sticking with cash is a less risky and better approach.

Good to see you, Amy.

Great to see you too.

Let's start with an explainer.

What is cash?

Because it's more than just the dollar bills in our wallet, right?

Right.

And I don't know about you, but I hardly ever have cash in my wallet these days.

I struggle with that.

So cash could be any type of asset that is very safe, liquid, and short term. So it could be something like a money

market fund, a savings account. I think we'll talk about some of the other options later.

But the official definition is a cash has a maturity date of three months or less. So it's

very short term. It's not really going

to be affected by changes in interest rates in terms of price movements. Interest rates are a

popular topic right now. The Federal Reserve is scheduled to announce their interest rate decision

...