Biggest lesson i learnt in 2023 in the stock market is that nobody knows what is going to happen next, so practice some humility and low a strategy with a long term edge.
Nobody knows anything; You need to create your own process, manage risk, and stick to the plan, through thick or thin, While also continuously learning from mistakes and improving.
Uncertainty... it took me 5 years to stop trying to predict what bout to happen in market based on charts studying, cause you never know. not having a mentor cost me 5 years of pain I learn to go we’re the market is wanting to go and keep it simple with discipline.
Thanks, and kudos for the way you've approached this subject - having watched other rather alarmist videos on certain other channels about this subject, it is good to have some commentary from someone with a cool head. Rather than a clickbait headline you actually answer the question you posed in a calm and considered way.
The original Money Mark Fund in 1980's - Reserve Fund, was basically a bank account that gave limited chequing and a Debit Card (unusual in the USA) . The concept was that it could take a basic customers money and merge it with others, giving leverage to buy short investments at higher rate than an individual could on their own.
Using CSH2 To hold as of This month 2 years of expenses for my planned retirement Which is in around 2-3 years Time Considering a bond ladder but I could continue working so The money market fund is more flexible hopefully it's a reasonably safe option Ps Thanks for The video
Nice segment Ramin. So, in my US Vanguard Federal Reserve MM acct, monthly interest on 100k is about $550 a month. On 100k in my checking acct, monthly div was 90 cents. Yes, that's cents, not dollars. I'm not quite ready to go back into the stock market quite yet. Have been all out for past 16 months. Waiting on a good dip in the general markets. If there is one, will certainly scale in.
Very good explanation but one risk wasn't emphasized. These are equity liabilities for the issuer not debt liabilities. Debt liabilities have equity behind it to pay out in an insolvency but equity liabilities don't. Also there are no deposit guarantees by the government on these products. If you have money on deposit you have deposit protection. If you buy money market products your investment is unprotected. Deposit protection- In UK this is £85000. In US $250000 In Australia A$ 250000.
Currently my Vanguard MM is paying me 5.29%. That is over $2K per month and I'm happy with that. I'll be retiring in April of next year so I am not wanting to take much risk. If the MM payout drops below 4%, I will look at alternatives.
Not that it’s of any of my business, but if my calculations are right you should be on $4k+ per month on 1m+, not only $2k+. Either your actually invested around 500k in MM or your platform has a ridiculously high platform fee.
I use MM funds because we are actively house hunting and we don't want to pull our money from the market after a sudden crash. If you're nervous about MM, just do an FDIC high yield savings - they are very close to MM now.
Great video as always. I admit to skipping some beats on hearing about ceti changes and the removal of ringfencing in 2022 - I believe some return to over extended lending will return. Is the current consumer boom based on depleting savings or wage rises?
Thanks for all the great informative videos Ramin...may sound a little stupid but how long is too long in my vanguard short-term money market fund.. is 6months the sweet spot? Just when do you know the right time to pull out and find an alternative fund. depending on interest rates
Thank you for another useful video Ramin. Would Money Market Funds make a sensible third fund in a 3 fund portfolio (E.g. 60% equities, 20% bonds & 20% money market funds)?
This video demonstrates why PensionCraft is growing a thriving community of people keen to learn and educate themselves on how to make better-informed investment decisions .. and with access to a toolkit of high quality, informative and well-balanced content ... keep up the excellent work Ramin!
A question about Vanguard's Sterling Short-Term Money Market Fund. Is it true that the price is always £1.00 if you are investing, so £1,000 will always buy 1000 units? If so, do you get the same payout at the end of the month, no matter if you invest on the 1st of the month, or the second last day of the month?
Hi Ramin, Have been watching and enjoying your videos for a long time and am one of your biggest fans. Would appreciate it if you could do a video on TLT etf and TMF etf. Thanks a million.
I use L&G Cash fund within tax efficient wrappers for my cash holdings approx 5% of portfolio for 3 years expenses. I think this is sensible, but appreciate any feedback?
“Very high rates central banks currently setting” = Mean reverted rates…. A Run on money Market funds is exactly what happened to the Standard Life Sterling Fund in 2008/9. SL ended up putting in corporate liquidity to the fund from memory…
I was listening to you through out, the word short term was repeated many times but not defined at all. I kept on waiting to hear the length of short term wàs it one, two, three months or one, two years?
Interesting timing 😅 the video is 6 days old and 4 days ago Trading 212 wrote to say from January you're only going to get interest on cash if you opt in to use qualifying money market funds 🙂
UK Gilts or US T Bills? He did a video on Gilts a few months ago. Not sure about US TBs from the UK. They like to make it hard for us so that we don't make the money availble to the elites..
Im using CSH2 and single short duration governments gilts like TN24 for my short term saving in my SIPP instead of bond ETFs, its just about 10% though of my overall holdings. Thanks Ramin for explaining how to access these instruments and how they work in one of your previous videos. I have not used these as a flight to safety but rather just for short term good levels of effective and stable interest on my cash like buffer.
@@Charzhino CSH2 is tied to the SONIA rate which is a bit above 5% at the moment. It’s accumulating daily so the amount invested will tick up everyday.
CSH2 , lyxor overnight GBP to achieve above Sonia rates. I have serious doubts about it's safety. Performance indeed replicates well Sonia with very low volatility but the prospectus suggests that the holdings of this funds are mainly US equities and top 10 percent of holdings don't mention any GBP futures not US equity hedges. It may be a swap in which the money is lended to investment bank in return for equity collateral in this stocks and the bank pays the overnight return. In the event of an equity market crash I wonder if access to the funds can be restricted because the collateral won't be sufficient to cover the withdrawals. So it's may not be as safe as gilts or futures. No guarantee for capital return
Isn't holding MM funds in a "fun portfolio" an oxymoron? The only reason for holding MM funds is and has always been to avoid market volatility for access to short term cash requirements. Any other reason is just gambling as you'll discover when you notice that the other asset classes have increased in price when you cure your addiction
![Blox Fruits Dragon Rework Update [Full Stream]](http://i.ytimg.com/vi/EqDAp8udhm0/mqdefault.jpg)
Biggest lesson i learnt in 2023 in the stock market is that nobody knows what is going to happen next, so practice some humility and low a strategy with a long term edge.
Nobody knows anything; You need to create your own process, manage risk, and stick to the plan, through thick or thin, While also continuously learning from mistakes and improving.
Uncertainty... it took me 5 years to stop trying to predict what bout to happen in market based on charts studying, cause you never know. not having a mentor cost me 5 years of pain I learn to go we’re the market is wanting to go and keep it simple with discipline.
As always, the only reliable non-financial advice based commentary available online
@@stevo728822 Just sound investment advice. He's not a trader. He is retired so there's that.
@@stevo728822 Maybe he doesn't own one, want one or need one?
Glad you think so! @Graemecrompton
Only ? Come off it
Thanks, and kudos for the way you've approached this subject - having watched other rather alarmist videos on certain other channels about this subject, it is good to have some commentary from someone with a cool head. Rather than a clickbait headline you actually answer the question you posed in a calm and considered way.
Glad you enjoyed it! @daveharruk
The original Money Mark Fund in 1980's - Reserve Fund, was basically a bank account that gave limited chequing and a Debit Card (unusual in the USA) . The concept was that it could take a basic customers money and merge it with others, giving leverage to buy short investments at higher rate than an individual could on their own.
Using CSH2 To hold as of This month 2 years of expenses for my planned retirement
Which is in around 2-3 years Time
Considering a bond ladder but I could continue working so The money market fund is more flexible hopefully it's a reasonably safe option
Ps Thanks for The video
Thank you @hxjohn I appreciate the support! Ramin
Nice segment Ramin. So, in my US Vanguard Federal Reserve MM acct, monthly interest on 100k is about $550 a month. On 100k in my checking acct, monthly div was 90 cents. Yes, that's cents, not dollars. I'm not quite ready to go back into the stock market quite yet. Have been all out for past 16 months. Waiting on a good dip in the general markets. If there is one, will certainly scale in.
The dip was October 2022.... US stocks have rallied 28% since then.
😂
Very good explanation but one risk wasn't emphasized. These are equity liabilities for the issuer not debt liabilities. Debt liabilities have equity behind it to pay out in an insolvency but equity liabilities don't. Also there are no deposit guarantees by the government on these products. If you have money on deposit you have deposit protection. If you buy money market products your investment is unprotected. Deposit protection- In UK this is £85000. In US $250000 In Australia A$ 250000.
“Consumer has simply not stopped spending” = record personal debt / Credit card debt in US…. Can’t go on forever.
Fair point; is there a website that shows a chart with the amount of personal debt over time?
Currently my Vanguard MM is paying me 5.29%. That is over $2K per month and I'm happy with that. I'll be retiring in April of next year so I am not wanting to take much risk. If the MM payout drops below 4%, I will look at alternatives.
I just love that you're making the same amount as I am, so I immediately knew you had about 1/2M in your MM.
Not that it’s of any of my business, but if my calculations are right you should be on $4k+ per month on 1m+, not only $2k+. Either your actually invested around 500k in MM or your platform has a ridiculously high platform fee.
Great content as always. Love this channel.
Glad you enjoy it! @lplate1000
Thanks!
Thank you @mccready7479 much appreciated! Ramin
I use MM funds because we are actively house hunting and we don't want to pull our money from the market after a sudden crash. If you're nervous about MM, just do an FDIC high yield savings - they are very close to MM now.
I want to understand bonds, SOFR yield curve, Money market funds, RRP in depth. How do I proceed?
Great video as always. I admit to skipping some beats on hearing about ceti changes and the removal of ringfencing in 2022 - I believe some return to over extended lending will return. Is the current consumer boom based on depleting savings or wage rises?
Would love some sort of reminder type video about the 2008/2009 crisis in the format of how you linked to articles on FT in this video
Glad to see Dimson, Marsh and Staunton get (yet another) mention.... 😁
I only hold emergency fund in CSH2 MM, I’ll hold it until the rates will be at least 4% and more, and as soon as they’ll go below I’m pulling out
I'll probably do something similar. Once the rates drop below 4%, the appeal of them kind of fades.
@@TomsPersonalFinancewhere will you allocate if it drops below 4%?
Thanks for all the great informative videos Ramin...may sound a little stupid but how long is too long in my vanguard short-term money market fund.. is 6months the sweet spot? Just when do you know the right time to pull out and find an alternative fund. depending on interest rates
Thank you for another useful video Ramin. Would Money Market Funds make a sensible third fund in a 3 fund portfolio (E.g. 60% equities, 20% bonds & 20% money market funds)?
Why would you hold bonds over MMFs right now?
Ramin has done a video on this, and iirc he replaces his bond funds with either mmfs or single govvies. So arguably - yes.
This video demonstrates why PensionCraft is growing a thriving community of people keen to learn and educate themselves on how to make better-informed investment decisions .. and with access to a toolkit of high quality, informative and well-balanced content ... keep up the excellent work Ramin!
Thank you @MrNickml
Excellent analysis, thanks
Thanks.
Much appreciated! @Ed-bj5eq
How are MM fund taxed in the UK if outside of and ISA or SIPP? Is it CGT or Income Tax?
17:18 very hard to imagine a scenario that almost happened just earlier this year? or that wasn't it? (SVB)
Has anyone been to the shops recently? No one is buying anything, they are just window shopping. Not sure where this retail optimism comes from!
Pubs and restaurants are always full where I live. Must be credit spending or the bank of dad.
Slightly alarmed that someone over 20 thinks a “normal level” for interest rates is 2-2.5%
Normal for me is around 5% coming from the 80's ! 10%
A question about Vanguard's Sterling Short-Term Money Market Fund. Is it true that the price is always £1.00 if you are investing, so £1,000 will always buy 1000 units? If so, do you get the same payout at the end of the month, no matter if you invest on the 1st of the month, or the second last day of the month?
Always £1 but your interest is pro-ratered
@@actuallythedog263 thanks, that’s what I would expect. Just wanted confirmation.
Really interesting video 😊
Thanks @oliverjamesspicer
Hi Ramin, Have been watching and enjoying your videos for a long time and am one of your biggest fans. Would appreciate it if you could do a video on TLT etf and TMF etf. Thanks a million.
I use L&G Cash fund within tax efficient wrappers for my cash holdings approx 5% of portfolio for 3 years expenses. I think this is sensible, but appreciate any feedback?
What are your views on loosing FCS protection when ticking the Trading212 earn interest button what is the risk?
Such a great channel
Thank you @alkerbix
Thank you for doing this video @pensioncraft very imformative
Thanks @DavidLee-uh3xz
If I buy CSH2 this tax year, and sell it next tax year, will i use next tax years interest allowance?
Why on UK platforms can't we invest in foreign money market funds / Emerging Market funds, surely they would carry a much higher interest rate %?
Thank you so much for your videos.
You are so welcome! @justinarnold1431
Is it normal to hold this in a general account (not isa or sipp)?
Should you use a money market fund? As as a 2 year buffer.
In case your main pension fund. Crashes
That's what I'm doing. I'm approaching retirement and have a MM fund as a buffer to draw from in case my stocks fall, or grow more slowly than the MM.
@david_akerman It's always reassuring.
To hear people.
Thinking the same way as you
“Very high rates central banks currently setting” = Mean reverted rates…. A Run on money Market funds is exactly what happened to the Standard Life Sterling Fund in 2008/9. SL ended up putting in corporate liquidity to the fund from memory…
What are the UK tax implications on MMF returns if invested outside of ISA?
Why take the risk of gating in MMF when you could buy individual short dated gilts? Americans can buy short term Treasuries from Treasury Direct.
I’m interested in loan notes. Especially for property development.
CSH2 has fallen this week (0.26% or so), why does this happen?
With such low return isn’t a GIC of 4.5% better?
I was listening to you through out, the word short term was repeated many times but not defined at all. I kept on waiting to hear the length of short term wàs it one, two, three months or one, two years?
Hmm, seems like some banks may be showing some cracks as commercial real estate suffers.
Investments are the roots of financial security; the deeper they grow, the stronger your future will be."
The deeper your investment roots, the stronger your financial security will be in the future.
Interesting timing 😅 the video is 6 days old and 4 days ago Trading 212 wrote to say from January you're only going to get interest on cash if you opt in to use qualifying money market funds 🙂
Why can’t I see chs2 on trading 212
CSH2 not CHS2 🙃
@@Homo-Maverick thanks I'm assuming the spread is costly?
Retail boom?
Is there any way for common man to be able to buy only UK Treasury Bills and avoid MMFs?
UK Gilts or US T Bills? He did a video on Gilts a few months ago. Not sure about US TBs from the UK. They like to make it hard for us so that we don't make the money availble to the elites..
Im using CSH2 and single short duration governments gilts like TN24 for my short term saving in my SIPP instead of bond ETFs, its just about 10% though of my overall holdings. Thanks Ramin for explaining how to access these instruments and how they work in one of your previous videos. I have not used these as a flight to safety but rather just for short term good levels of effective and stable interest on my cash like buffer.
Can you give me a brief run down on CSH2? How much does it yield and how often?
Every day, trade 212
5.4 percent or so
@@Charzhino CSH2 is tied to the SONIA rate which is a bit above 5% at the moment. It’s accumulating daily so the amount invested will tick up everyday.
@@thomasmcdonald5542 thanks.
Can anyone recommend a website or tool for me to benchmark my freetrade GIA against the S&P/Nasdaq or other ETFs?
JustETF for UK and Europe; Portfolio visualiser for US.
What does chastising the banks actually mean, a strongly worded letter/call?🤣
No !
CSH2 , lyxor overnight GBP to achieve above Sonia rates. I have serious doubts about it's safety. Performance indeed replicates well Sonia with very low volatility but the prospectus suggests that the holdings of this funds are mainly US equities and top 10 percent of holdings don't mention any GBP futures not US equity hedges. It may be a swap in which the money is lended to investment bank in return for equity collateral in this stocks and the bank pays the overnight return. In the event of an equity market crash I wonder if access to the funds can be restricted because the collateral won't be sufficient to cover the withdrawals. So it's may not be as safe as gilts or futures. No guarantee for capital return
Isn't holding MM funds in a "fun portfolio" an oxymoron? The only reason for holding MM funds is and has always been to avoid market volatility for access to short term cash requirements. Any other reason is just gambling as you'll discover when you notice that the other asset classes have increased in price when you cure your addiction
If you’ve read the book..The Great Taking & the author is correct then ..NO
We’re not at the peak of the cycle just yet. Another couple of years to go (based on average of 18 years). Crashes are getting bigger.
"...the biggest risk is not what you might think. This video is sponsored by... "
And now the sponsor / T212 is asking people to use MMF if they want to keep earning interest on cash
More capital comes more greed. Fiat is slowly collapsing and bank sectors also. I believe I will see a bail in one day in my life time
Please use Chapstick or similar. Your lips are very dry and cracked.
Probably from walking Teddy in the cold
@@HJM49125 lol no they're literally always like this in every video.
Thanks!