Jack Hough from Barrons had a nice article in Barrons this week about "Cash Sorting". Basically, are you getting the returns you should be getting from your broker or are you asleep at the wheel? His article is attached and is in this week's Barrons (2/13/23). Be aware!
I personally found this out at Fidelity. For several years that I was with Fidelity, my cash was being kept in a "sweep account" where I was getting virtually no interest. Given the events of the last several years, you would expect low returns, but Fidelity had other funds where I could significantly increase my returns (don't ask - don't tell!). All I had to do was to move it. I was asleep at the wheel. I moved it early last year and saw my cash returns increase 10 fold. Plus, I "rode" the money market rate increases up as rates rose.
After that, I started watching cash yields much more closely. With money markets at Fidelity, Vanguard and TRowe, I started a comparison of money market 7 day yields which is attached. My finding was that Vanguard increased their yield much faster and were about 1/3 of percent higher than fidelity - CONSISTENTLY. I don't have to tell you where I moved my cash! Sure you have to move your cash but even with a few days lost interest, it pays in spades. Just set up cash withdrawals/deposits to your bank to move between brokerages.
I wrote about:
- disintermediating your funds in the spring of last year
- to watch your money market yields "Watch your money market yields! Brokerages will be happy if you take a lower yield."
Be smart, be well-read, be, aware and be successful.
“If you've been playing poker for half an hour and you still don't know who the patsy is, you're the patsy.”
-Warren Buffett
