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Best way to protect your money
06-05-2008, 02:05 PM
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#1
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Dryer sheet aficionado
Join Date: Apr 2008
Posts: 36
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Best way to protect your money
I currently have $100k in working capital & earnings set a aside from a business. It is earning a messly 3.5% in an online savings account. I'm looking for an ETF, ETN, REIT, fund, or another asset class that will have a higher yield without taking too much more risk. The money has to remain liquid in case it is needed in the business. Where is the best place to stash my working capital with little appetite for risk?
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06-05-2008, 02:13 PM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2003
Location: Hooverville
Posts: 22,983
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Quote:
Originally Posted by godoftrading
I currently have $100k in working capital & earnings set a aside from a business. It is earning a messly 3.5% in an online savings account. I'm looking for an ETF, ETN, REIT, fund, or another asset class that will have a higher yield without taking too much more risk. The money has to remain liquid in case it is needed in the business. Where is the best place to stash my working capital with little appetite for risk?
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Right where it is. You are doing fine.
Ha
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"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
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06-05-2008, 02:27 PM
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#3
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Moderator Emeritus
Join Date: Feb 2006
Location: San Francisco
Posts: 8,827
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Quote:
Originally Posted by godoftrading
I currently have $100k in working capital & earnings set a aside from a business. It is earning a messly 3.5% in an online savings account. I'm looking for an ETF, ETN, REIT, fund, or another asset class that will have a higher yield without taking too much more risk. The money has to remain liquid in case it is needed in the business. Where is the best place to stash my working capital with little appetite for risk?
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If it really needs to be "liquid" over the next couple of years, you really can't expect to earn S&P rates without taking some risk of loss at a time when you need it.
A compromise might be a short term government bond fund. It might pay 4-4.5% if you're lucky and be almost as liquid as cash. Of course there is a small risk of capital loss in that, unlike a MMF.
Or maybe half in stocks and half in the MMF? At least you can get to much of the money, and reduce the risk of having to sell stocks low. But either way the bottom line is that higher yield requires higher risk most of the time.
__________________
Rich
San Francisco Area
ESR'd March 2010. FIRE'd January 2011.
As if you didn't know..If the above message contains medical content, it's NOT intended as advice, and may not be accurate, applicable or sufficient. Don't rely on it for any purpose. Consult your own doctor for all medical advice.
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06-05-2008, 02:32 PM
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#4
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
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Put half in beaver-cheese futures and put the other half on "red."
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"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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06-05-2008, 02:38 PM
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#5
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 1,183
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If you can lock it up a bit, cd's at some online banks, credit unions pay a good bit more. Check this site out Home | BankingMyWay.com . Perhaps you could live with and create a cd ladder?
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06-05-2008, 03:04 PM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2004
Location: South Texas~29N/98W Just West of Woman Hollering Creek
Posts: 6,674
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Quote:
Where is the best place to stash my working capital with little appetite for risk?
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Working capital is generally thought of as money that you will be spending soon (within 6 months). If you stashed it in anything except a money market fund or a savings account (as you have) you would be exposing the money to risks that you may not be happy with. I would leave it where it is if you are happy with the bank, otherwise, I would consider the Prime MMF @ Vanguard.
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Part-Owner of Texas
Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx
In dire need of: faster horses, younger woman, older whiskey, more money.
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06-05-2008, 03:07 PM
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#7
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Thinks s/he gets paid by the post
Join Date: Apr 2006
Posts: 1,490
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Quote:
Originally Posted by brewer12345
Put half in beaver-cheese futures and put the other half on "red."
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thought b3av3r-ch33se was verboten:confused:
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06-05-2008, 03:12 PM
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#8
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
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Quote:
Originally Posted by d
thought b3av3r-ch33se was verboten:confused:
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Shhh...
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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06-05-2008, 03:46 PM
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#9
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Moderator Emeritus
Join Date: Jan 2007
Location: New Orleans
Posts: 47,500
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Quote:
Originally Posted by mickeyd
Working capital is generally thought of as money that you will be spending soon (within 6 months). If you stashed it in anything except a money market fund or a savings account (as you have) you would be exposing the money to risks that you may not be happy with. I would leave it where it is if you are happy with the bank, otherwise, I would consider the Prime MMF @ Vanguard.
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Unfortunately while Vanguard's Prime MMF (VMMXX) was yielding well over 4% in February, it has sagged to only 2.23% right now. The OP said he is getting 3.5% at his bank. So, maybe he's better off just leaving it there.
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Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities. - - H. Melville, 1851.
Happily retired since 2009, at age 61. Best years of my life by far!
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06-05-2008, 06:19 PM
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#10
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Recycles dryer sheets
Join Date: Jun 2007
Posts: 183
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Quote:
Put half in beaver-cheese futures and put the other half on "red."
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PFFFF
/*spits out pop
Thanks a lot.
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06-06-2008, 08:25 AM
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#11
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2006
Posts: 12,483
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Keep it where it is, even the 7-day put bond rates fell off a cliff lately.........
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Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
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06-06-2008, 12:25 PM
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#12
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Thinks s/he gets paid by the post
Join Date: Apr 2007
Posts: 1,305
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another vote for keeping it where it is.
high yield = high(er) risk
low yield = low(er) risk
the laws of gravity
... no one seems to have figured out how to change these (yet).
'... you don't tug at supermans cape, ...you don't p*ss into the wind ...'
Jim Croce
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Life is GREAT!
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06-07-2008, 01:01 PM
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#13
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Thinks s/he gets paid by the post
Join Date: Dec 2004
Location: Minneapolis
Posts: 4,455
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Quote:
It is earning a messly 3.5% in an online savings account.
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That's a very good rate. What kind of rate are you looking for? What's is the estimated time frame of liquidity? If it's less than a year, just stay put.
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May we live in peace and harmony and be free from all human sufferings.
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06-07-2008, 01:48 PM
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#14
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2008
Posts: 7,437
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Looks like the oil futures market may be tantalizing.
You have Goldman Sachs predict $150 oil a few weeks back and it jumps over $130.
Then T. Boone Pickens says it as well and oil goes up.
Then this past week, Morgan Stanley says $150 by July 4th and oil jumps over $11 in one day.
Hmm, wonder where their positions were...
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06-08-2008, 01:20 PM
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#15
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Dryer sheet wannabe
Join Date: Jan 2008
Posts: 10
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Quote:
Originally Posted by explanade
Looks like the oil futures market may be tantalizing.
You have Goldman Sachs predict $150 oil a few weeks back and it jumps over $130.
Then T. Boone Pickens says it as well and oil goes up.
Then this past week, Morgan Stanley says $150 by July 4th and oil jumps over $11 in one day.
Hmm, wonder where their positions were...
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I want to short some oil. 90 days from now it will not be as high as it is now.
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06-08-2008, 02:01 PM
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#16
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Full time employment: Posting here.
Join Date: Jan 2006
Posts: 899
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Quote:
Originally Posted by godoftrading
I currently have $100k in working capital & earnings set a aside from a business. It is earning a messly 3.5% in an online savings account. I'm looking for an ETF, ETN, REIT, fund, or another asset class that will have a higher yield without taking too much more risk. The money has to remain liquid in case it is needed in the business. Where is the best place to stash my working capital with little appetite for risk?
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I would think that the God of Trading would know the answers to these questions
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06-08-2008, 02:18 PM
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#17
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,021
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__________________
Numbers is hard
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06-08-2008, 09:02 PM
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#18
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Recycles dryer sheets
Join Date: Jun 2007
Posts: 183
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Quote:
I want to short some oil. 90 days from now it will not be as high as it is now.
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Markets can stay irrational longer than you can stay solvent.
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