Enhanced Cash Investing

In the shadow of the recent Brexit vote, the high cost of cash might be in place much longer than many had planned. Even before the vote, historically low yields were persistent six months after the Fed raised rates for the first time in almost ten years. As such, those responsible for investing cash are under continued pressure to effectively manage operating funds in a more strategic manner. Too often, investors don’t take advantage of a limited risk strategy to increase the returns of their cash positions. Enhanced cash strategies can provide an effective alternative for a portion currently invested in money market funds (or their equivalent), what many investors consider their cash or liquidity allocation. For the purposes of this discussion, we are defining aportfolio’s “cash allocation” as a strategy or investment fund that has a duration or average maturity target of one year or less.

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