Experts said that beyond tapping into the current demand for low-risk instruments, the newer players are also interested in offering cash management solutions as part of growing their overall user base and business.
Currently, its users can invest in Singapore-dollar and US-dollar funds without incurring foreign exchange conversion fees. Funds in Hong Kong dollars will be added soon. “There is a place for cash management solutions in portfolio in any investment environment,” she said.Given the potential to earn some returns while enjoying a high degree of liquidity, cash management accounts made up of money market funds may be an option for retail investors in the current uncertain investing environment.
Simply put, the higher the credit rating, the better the quality of the underlying bonds or securities. Mr Wong explained: “In a normal market scenario where there are no market stress or liquidity crisis, corporates are normally able to make repayment and investors can enjoy the higher yield.