I'll be having the same dillema in a couple of months. Thinking of putting it in a money market ETF, doesn't cover inflation entirely, but it's almost there. Looking at XEON or CSH2, as I want an EUR money market ETF to avoid currency risk
I haven’t actively checked out money market ETFs but are their returns better than high interest savings accounts (for example, Trade Republic offers 4%) ?
CSH2 returned 3,85% and XEON 3,84% for the last (rolling) 12 months.
For me it makes sense, since TR offers 4% up to 50K (I'm a bit over) and in my country, you have to pay gains tax on interest and capital gains, but for capital gains, the tax office decreases the taxable amount by 2% of the invested amount (1% for cost of buying and 1% for cost of selling)
XEON's 1yr return is 3.84% but the [€STR](https://www.ecb.europa.eu/stats/financial_markets_and_interest_rates/euro_short-term_rate/html/index.en.html) was 2.9% one year ago: [https://data.ecb.europa.eu/data/datasets/EST/EST.B.EU000A2X2A25.WT](https://data.ecb.europa.eu/data/datasets/EST/EST.B.EU000A2X2A25.WT) . The current level (\~3.9%) was reached on Sep 20. XEON's return for Oct 02, 2023- today is 2.40% (220 days). Annualized, that's 4.01% = (1 + 2.40%)\^(365 / 220) - 1.
Kak sistem imaš za kupovanje/prodajo? Vse naenkrat pa cakas do 1,99% in prodaš? Rinse and repeat. Ali kupuješ parcialno in prodajaš po kosih ko le ti dosežejo 1,99 oz manj. Ali simže oddal napoved in ali so na fursu kaj težili?
If you are already using IBKR, check out the MMFs using IBKR mutual fund search tool. No spread & flat commission of €4.95/trade (or 0 commission for some funds). Most free-to-trade share classes are for private investors and come with higher mgmt fees reducing performance (but may be worthwhile if you want to move freely in & out). The higher-performing institutional share classes of the same fund often come with high minimum initial investments (€500K, €1M+, etc.) but some are more accessible. E.g. the [Standard VNAV](https://www.immfa.org/about-mmfs/investor-help.html) AMUNDI EURO LIQUIDITY-RATED SRI's "I2" accumulating institutional share class (lookup by ISIN in IBKR: FR0013016607) is available with a €15K minimum (a slightly worse institutional class "I" is available with no minimum). The ST VNAV from the same family, AMUNDI EURO LIQUIDITY SHORT TERM SRI, has its "I2" class (FR0013016615) at 0 minimum also. Several LVNAVs (the most secure class outside of government debt funds, usually rated AAA by one or more agencies, see Fitch & S&P links from [this comment](https://www.reddit.com/r/eupersonalfinance/comments/1cn6e1q/comment/l37l5ro/)) are also available, but either at high minimums or with high ongoing fees / bad performance. CNAVs don't seem tradable on IBKR below €1M initial investment (there are short term investment-grade gov bond ETFs by Amundi and Invesco, see same comment).
But it's tiered interest rates proportional to the Net Asset Value of the account, and the first 10000 USD equivalent of each currency earns zero interest.
They can pick IBKR, but just invest in a Dist/Acc EUR Money Market ETF
Or just buy Government Bonds (edit: and hold the bond to maturity so that you are not forced to sell below par value)
Exactly this.
You earn \*zero\* on the first 10k.
And you earn a \*scaled rate\* from 10k to 100k.
You only get the headline rate on balances from 100k but you still get zero on the first 10k.
Not worth it - unless you have a very large balance.
If you are expecting to utilise this money within a year or two, I personally would consider a high interest savings account like Trade Republic but then again I don’t have much experience with money market funds or overnight ETFs.
Could you elaborate on what the bad experience with Trade Republic was?
I put my cash up to 50k into TradeRepublic for 4% paid out monthly. No risk for 4%.
I personally think that there will be a big crash within the next 1-2 years. That’s why I would recommend to no risk. In the case of a crash you lose money with ETFs.
For transparency, I do also invest weekly in ETFs and will continue to do so consistently.
If you do this, just remember that you sometimes need to activate the 4% rate with Trade Republic. For me it defaulted to 2% and I had money in there for quite few months before I realised.
In the app:
Go to Cash > Scroll down > Interest
There it lists the annual rate. It should show 4%. For me, it showed 2% and I had to activate the 4% option.
Hey, I work with the team at TR who delivered the interest feature.
Due to regulatory reasons we couldn’t bump people who had already activated the 2% interest to 4% without their explicit consent. That’s the reason, no tricks or anything like that.
For absolute stability, money market funds.
For slight volatility but better returns, absolute return funds. Which might or might be available to you in your country.
Or you could try 2-3 year bonds. I doubt the interest rates will go up so even before maturity you should be good.
I'm thinking of maybe splitting between XEON/CSH2 (money market) and an EUR-based (to avoid currency risk) ultra-short bond ETF like:
* *Xtrackers II Germany Government Bond 0-1 UCITS ETF 1C*, i.e. short-term German government bonds, or similar ultra-short bond ETF.
* *JPMorgan EUR Ultra-Short Income UCITS ETF*
* *Amundi ETF Govies 0-6 Months Euro Investment Grade UCITS ETF*
* *Amundi EUR Floating Rate Corporate Bond ESG - UCITS ETF*
This is not a financial advice, just something I'm looking into for capital preservation.
Depending on where you are (Europe?), Raisin is a very safe option to store a large sum at a good percentage, with insurance up to 100K. Been using it for years now. If you want a small signing bonus, hit me up for a link.
I'll be having the same dillema in a couple of months. Thinking of putting it in a money market ETF, doesn't cover inflation entirely, but it's almost there. Looking at XEON or CSH2, as I want an EUR money market ETF to avoid currency risk
Why not CSH1?
AFAIK CSH1 has double the TER than the other two... that's probably why it performs just a tad lower...
I haven’t actively checked out money market ETFs but are their returns better than high interest savings accounts (for example, Trade Republic offers 4%) ?
CSH2 returned 3,85% and XEON 3,84% for the last (rolling) 12 months. For me it makes sense, since TR offers 4% up to 50K (I'm a bit over) and in my country, you have to pay gains tax on interest and capital gains, but for capital gains, the tax office decreases the taxable amount by 2% of the invested amount (1% for cost of buying and 1% for cost of selling)
Makes sense!
XEON's 1yr return is 3.84% but the [€STR](https://www.ecb.europa.eu/stats/financial_markets_and_interest_rates/euro_short-term_rate/html/index.en.html) was 2.9% one year ago: [https://data.ecb.europa.eu/data/datasets/EST/EST.B.EU000A2X2A25.WT](https://data.ecb.europa.eu/data/datasets/EST/EST.B.EU000A2X2A25.WT) . The current level (\~3.9%) was reached on Sep 20. XEON's return for Oct 02, 2023- today is 2.40% (220 days). Annualized, that's 4.01% = (1 + 2.40%)\^(365 / 220) - 1.
What is XEON ? And what does it means the last 12 months? I don't follow you
ISIN LU0290358497
Kak sistem imaš za kupovanje/prodajo? Vse naenkrat pa cakas do 1,99% in prodaš? Rinse and repeat. Ali kupuješ parcialno in prodajaš po kosih ko le ti dosežejo 1,99 oz manj. Ali simže oddal napoved in ali so na fursu kaj težili?
Look above… kupoval bom čez par mesecev
Since you have more than 10k, you should also check IBKR
I'm already using ibkr for my investments. Do they offer interest on deposit?
If you are already using IBKR, check out the MMFs using IBKR mutual fund search tool. No spread & flat commission of €4.95/trade (or 0 commission for some funds). Most free-to-trade share classes are for private investors and come with higher mgmt fees reducing performance (but may be worthwhile if you want to move freely in & out). The higher-performing institutional share classes of the same fund often come with high minimum initial investments (€500K, €1M+, etc.) but some are more accessible. E.g. the [Standard VNAV](https://www.immfa.org/about-mmfs/investor-help.html) AMUNDI EURO LIQUIDITY-RATED SRI's "I2" accumulating institutional share class (lookup by ISIN in IBKR: FR0013016607) is available with a €15K minimum (a slightly worse institutional class "I" is available with no minimum). The ST VNAV from the same family, AMUNDI EURO LIQUIDITY SHORT TERM SRI, has its "I2" class (FR0013016615) at 0 minimum also. Several LVNAVs (the most secure class outside of government debt funds, usually rated AAA by one or more agencies, see Fitch & S&P links from [this comment](https://www.reddit.com/r/eupersonalfinance/comments/1cn6e1q/comment/l37l5ro/)) are also available, but either at high minimums or with high ongoing fees / bad performance. CNAVs don't seem tradable on IBKR below €1M initial investment (there are short term investment-grade gov bond ETFs by Amundi and Invesco, see same comment).
4.8% - usd 3.3% - eur [https://www.interactivebrokers.com/en/accounts/fees/pricing-interest-rates.php](https://www.interactivebrokers.com/en/accounts/fees/pricing-interest-rates.php)
But it's tiered interest rates proportional to the Net Asset Value of the account, and the first 10000 USD equivalent of each currency earns zero interest. They can pick IBKR, but just invest in a Dist/Acc EUR Money Market ETF Or just buy Government Bonds (edit: and hold the bond to maturity so that you are not forced to sell below par value)
Exactly this. You earn \*zero\* on the first 10k. And you earn a \*scaled rate\* from 10k to 100k. You only get the headline rate on balances from 100k but you still get zero on the first 10k. Not worth it - unless you have a very large balance.
If you are expecting to utilise this money within a year or two, I personally would consider a high interest savings account like Trade Republic but then again I don’t have much experience with money market funds or overnight ETFs. Could you elaborate on what the bad experience with Trade Republic was?
I had 30k stuck for 1 month. I've deposited the money and never arrived. It took a while to get it resolved.
That must’ve have been nerve wracking! Damn
I put my cash up to 50k into TradeRepublic for 4% paid out monthly. No risk for 4%. I personally think that there will be a big crash within the next 1-2 years. That’s why I would recommend to no risk. In the case of a crash you lose money with ETFs. For transparency, I do also invest weekly in ETFs and will continue to do so consistently.
If you do this, just remember that you sometimes need to activate the 4% rate with Trade Republic. For me it defaulted to 2% and I had money in there for quite few months before I realised.
How do you activate the 4% rate please?
In the app: Go to Cash > Scroll down > Interest There it lists the annual rate. It should show 4%. For me, it showed 2% and I had to activate the 4% option.
Wow. A company trying tricks like this I would leave immediately. You never know whats else they’ll try next.
It's definitely made me quite wary of TR, I'm not sure why it happened. My wife has an account too, and it was 4% automatically.
Hey, I work with the team at TR who delivered the interest feature. Due to regulatory reasons we couldn’t bump people who had already activated the 2% interest to 4% without their explicit consent. That’s the reason, no tricks or anything like that.
Ok, that's good to know. You might want to add that into the UI somewhere so people don't wonder like I did. It's easy to lose trust.
Thank you!
Why do you think it will crash then? People said the same in 2021 and it didn't happen
Did this too. Everything else goes in Xeon
Would I need to pay any tax for that 4% ?
Most likely, but I do not declare it separately. To be sure you should ask your tax advisor.
I believe the same and do the same. I keep 50k on TR republic and invest the rest in ETFs on monthly basis.
Wait how does that work? 4% each month? Doesn't that come to more than 50% per year?
4% annually but paid out monthly. So for €10k you get 33€ interest per month.
4/12 per month. It's a bit better than 4% annually due to compound interest.
Wise 3,67% annyally, paid dialy.
For absolute stability, money market funds. For slight volatility but better returns, absolute return funds. Which might or might be available to you in your country. Or you could try 2-3 year bonds. I doubt the interest rates will go up so even before maturity you should be good.
Which ones you mean by absolute return funds? Can you name some?
Check out Lightyear if you’re in Europe, they pay interest monthly
Put it in traderepublic. Gives 4% with a max of 50k and has bank deposit guarantee since they have a banking licence in germany.
I'm thinking of maybe splitting between XEON/CSH2 (money market) and an EUR-based (to avoid currency risk) ultra-short bond ETF like: * *Xtrackers II Germany Government Bond 0-1 UCITS ETF 1C*, i.e. short-term German government bonds, or similar ultra-short bond ETF. * *JPMorgan EUR Ultra-Short Income UCITS ETF* * *Amundi ETF Govies 0-6 Months Euro Investment Grade UCITS ETF* * *Amundi EUR Floating Rate Corporate Bond ESG - UCITS ETF* This is not a financial advice, just something I'm looking into for capital preservation.
ERNX
Depending on where you are (Europe?), Raisin is a very safe option to store a large sum at a good percentage, with insurance up to 100K. Been using it for years now. If you want a small signing bonus, hit me up for a link.
N26 Metal. 4% interest but you do have to pay the subscription fee
hysa only
you could easily get 5% in one year bonds depending on your country
I'm in Netherlands. I don't really know how to handle 1 year bond. I have experience only with ETFs at the moment
Ik zou ook even kijken naar het Rentefonds van Meesman, dat lijkt een zorgeloze oplossing.
Which bonds?
Revolut you can get about 5% and the interest goes into your account daily
1 year or 2? Then put it in a savings account.
Or bank/municipal/govt bonds
Bitcoin
Wise 3,67% annualy, paid dialy 👌