There are several good reasons you may want to keep some cash on the sidelines. If you’re retired, for example, and your priority is capital preservation, it can be a smart idea to keep some of your assets in cash.
The problem with keeping cash on the sidelines is that savings account interest rates are extremely low right now, and in order to get a decent interest rate on your cash, you need to commit to a CD that you can’t touch for several years without paying a penalty.