Cash as investment strategy

Personal finance, Value investing

On Friday, I moved more cash from my money market fund to a 3-month 5.41% APY CD, similar to what I did previously with some . The yield is a full percentage point above what I’m getting at my MMF. My plan is to see what the Fed decides and to re-evaluate my positions in October when my CDs mature.

One commenter pointed out that the 3-month CD would be a good investment vehicle assuming the cash isn’t needed immediately. But even if you need more liquidity, there are usually several banks offering competitive savings account rates, such as Citibank, Emigrant Direct, and HSBC. (aff) with no minimum to open is currently the best around.

It’s not necessarily my intention to stay in cash for a long time, but until I can find worthy investment vehicles, it’s great to be able to get this type of return (even if higher rates often go hand-in-hand with higher inflation).

In the meantime, I plan to start experimenting a bit with (or as Graham termed them, “workouts”) starting with the information provided by George at Fat Pitch Financials. With his permission, I’ll discuss some of my experiences with this type of investing here.


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Experiments in Finance’s Take on Contributor’s Corner - Fat Pitch Financials

[…] Ricemutt signed up as a paying member of Fat Pitch Financials Contributor’s Corner a few months ago and asked me if she could write about her experience. I agreed and she posted an article detailing her first ever special situation investment (Advanced Nutraceuticals)┬ábased on information posted in Contributor’s Corner. This past Thursday Ricemutt posted the results of her experiment. I’m happy and proud to report that Fat Pitch Financials Contributor’s Corner helped Ricemutt earn $259.51, a 14.9% gain. She calculated that her investment had an annualized return of 176.4% (APY). […]