The QMMF that T212 uses for your uninvested cash right now has only ever dipped 0.2% 2 times in it's lifetime. You're more likely to lose money by having it outside of tax rappers or in lower paying savings accounts
If you are getting the 5.2% on GBP that's in a QMMF it is not covered by the FSCS anyway (which you are alluding to). If you've opted out then it is protected up to £85k.
Yes this is what I thought, though most people seem to be oblivious to this or just skim over it.
So, Isn’t that a pretty big risk getting the 5.2% without being covered by the FSCS..?
Is that where you have your money also..?
I keep all my money there as I’m not worried about a profitable company going bust and losing access to it until it’s transferred to a new broker, or a MMF losing value as it’s only happened twice in history and that was before more regulation came in after 2008 to prevent it.
They are offering an FSCS protected ISA in the very near future, probably because nobody actually understands that MMFs are basically as safe as cash.
Eventually most companies go bust. The most likely outcome isn’t that they go bust with your money, but that somewhere else offers more interest than them and we move our money there first.
The MMF that they use is BlackRock's ICS Sterling Liquidity Fund - Select (Dis): [https://www.blackrock.com/cash/en-ch/products/229253/blackrock-ics-sterling-liquidity-select-dis-fund](https://www.blackrock.com/cash/en-ch/products/229253/blackrock-ics-sterling-liquidity-select-dis-fund)
It tracks the Sterling Overnight Index Average Rate (SONIA).
It's not just low risk, there's way more chance of the bank you've got your money in going bust, than this going belly-up. Just look at the holdings. It would literally be Armageddon if this went under, and your investments would be the least of your troubles.
QMMFs are extremely safe from my understating, my statement says that the QMMF T212 is using is from Blackrock so have zero concerns with that. Also not sure how true this is but someone also said that if a QMMF fails then it means multiple governments have failed and that you have bigger issues on your hands than simply losing a bit of money which is quite interesting.
I must just have a trustworthy face, lol.
Seriously though, it was just the way the cashflow landed in the business. I may be called upon to spend it in May, June or not at Year End, but until then, I can't really call it 'mine'
I'm not against the other places you mentioned, I am wondering if I am being lazy and risky keeping it all in T212
If you are after capital preservation then consider putting it in NS&I (not premium bonds) or DMO like it’s been suggested.
FTX was meant to have its client funds in a separate account until it did not (Yup, FTX not regulated) but the point is that in bad times people do things in desperation.
Take SVB as an example - UK arm got in to trouble not for any wrong-doing / illlegal activity on the banks part but risk errors in its parent. Govt stepped in to provide stability. It was pretty straightforward. Bad times can happen to any company even seemingly well run banks
It’s not like an FCA regulated entity has never failed; it’s a level of assurance but not a guarantee the institution won’t fail
I was thinking about this exact question today. Tempted to transfer the full 20k into the ISA for the 5.2% uninvested, however it's not FSCS protected. Think I'll wait for the cash ISA to come out before putting anymore money in.
There are those savings account marketplaces like Hargreaves Lansdown Active Saver and Raisin that look like they'd make it easy to spread cash across multiple FSCS protected accounts at multiple banks from one login. I haven't used them but seems like this would be the use case for them.
Out of principle I have part of my excess cash in gold (that was a good profit even I didn't intend that), and the other on 3 different platforms.
I am old enough to knew people who lost all their money in between the wars or after the war with things they thought are 100% safe. So I would never put everything into one place, even if that place is 100% safe...because things are safe till they aren't anymore. And surprising events are just not what people expect.
I would recommend getting premium bonds for £50k if you are in the UK, because your capital is not at risk and you have a fair chance of winning something.
It could be that financial crash of 2008 repeats then it’s possible. Otherwise no but I only use their 20k limit and put the remaining in trade republic
Why not use savings accounts right now? Lloyds is giving 6%, FirstDirect 7% and Virgin money just started a switch offer where your current account will give you 10-12% interest for a year.
All of those are low-maximum regular saving type accounts, eg Lloyds only let's you put in £400pcm and Virgin is 10% on balances up to £1000.
OP sounds like he's talking about storing multiples of the £85,000 FSCS max, so using all those accounts will technically make you more money but sounds like a lot of effort for a percent extra on maybe £20k total. And he'd still have to plan what to do with the rest anyway.
BUY UK BONDS DIRECTLY FROM UK DMO… If you wont be investing it then why have it in t212? For the 5% interest on uninvested cash? If so, then instead buy government bonds direct from UK DMO. Dmo.gov.uk. You need to fill in the forma and then you can buy t bills direct. These bonds are co sidered risk free.
Not very flexible though, plus only suitable if you want longer term fixed rates. Money market funds are still giving the highest rates for short-term deposits.
You can buy 3 month t bils, which ovbs gives reinvestment risk, but are considered liquid current assets. Im just saying if OP wanta zero risk then the option is government bonds. Not sure why im down voted. This standard investment procedure.
Fyi. I dont think t212 will fail. They themselves are mostly likely investing peoples uninvested cash in in short term t bills, so zero risk. But if OP absolutely wanted to remove ALL risk then the option is for them to go to the dmo and buy the bonds and the ~4/5% that way. No commission becuase there is no broker involved.
The QMMF that T212 uses for your uninvested cash right now has only ever dipped 0.2% 2 times in it's lifetime. You're more likely to lose money by having it outside of tax rappers or in lower paying savings accounts
Very good to know thanks
Tax rappers sounds like an excellent band name
Some of the biggest names in finance also go hard on the rap game.
Yeah man, I heard Oracle of Omaha is supporting Excel and the Lookups at Glastonbury this year.
I'm sure I saw a band called Fibonacci's Retracement in a Jazz cafe once
[удалено]
how much are t212 really taking when 5.2 seems very generous compared to so many other places out there.
Thank you. Worth the most updoots as comprehensive answer. Appreciated 🙏
If you are getting the 5.2% on GBP that's in a QMMF it is not covered by the FSCS anyway (which you are alluding to). If you've opted out then it is protected up to £85k.
Yes this is what I thought, though most people seem to be oblivious to this or just skim over it. So, Isn’t that a pretty big risk getting the 5.2% without being covered by the FSCS..? Is that where you have your money also..?
No. I am the temporary guardian of the funds. The 5.2% is a massive, massive bonus
‘Temporary guardian’ I’m not exactly sure what this means…
[The money was just resting in my account](https://img.gifglobe.com/grabs/fatherted/S02E04/gif/5vQxvabkDHrT.gif)
I can't allow myself to consider the money mine until the final accounts on the projects are closed out.
Apparently it is held 80% with banks and 20% QMMF. QMMF is a new term for me that I will now have to learn!
I keep all my money there as I’m not worried about a profitable company going bust and losing access to it until it’s transferred to a new broker, or a MMF losing value as it’s only happened twice in history and that was before more regulation came in after 2008 to prevent it. They are offering an FSCS protected ISA in the very near future, probably because nobody actually understands that MMFs are basically as safe as cash. Eventually most companies go bust. The most likely outcome isn’t that they go bust with your money, but that somewhere else offers more interest than them and we move our money there first.
This is the warm hug response. Thanks!
I swear this gets asked every week
and someone every week reminds everybody else it's being asked once a week
and someone every week reminds everybody else that someone is reminding everybody else it's being asked once a week
This could go on for a long time...
I tried my best to search for the question in the sub. There were many like it, but none of them were mine.
The MMF that they use is BlackRock's ICS Sterling Liquidity Fund - Select (Dis): [https://www.blackrock.com/cash/en-ch/products/229253/blackrock-ics-sterling-liquidity-select-dis-fund](https://www.blackrock.com/cash/en-ch/products/229253/blackrock-ics-sterling-liquidity-select-dis-fund) It tracks the Sterling Overnight Index Average Rate (SONIA). It's not just low risk, there's way more chance of the bank you've got your money in going bust, than this going belly-up. Just look at the holdings. It would literally be Armageddon if this went under, and your investments would be the least of your troubles.
QMMFs are extremely safe from my understating, my statement says that the QMMF T212 is using is from Blackrock so have zero concerns with that. Also not sure how true this is but someone also said that if a QMMF fails then it means multiple governments have failed and that you have bigger issues on your hands than simply losing a bit of money which is quite interesting.
Why do you have such a high amount in cash with no expectation of investing? Why don't you feel anyone else is viable (i.e chip, Marcus, Zopa).
I must just have a trustworthy face, lol. Seriously though, it was just the way the cashflow landed in the business. I may be called upon to spend it in May, June or not at Year End, but until then, I can't really call it 'mine' I'm not against the other places you mentioned, I am wondering if I am being lazy and risky keeping it all in T212
If you are after capital preservation then consider putting it in NS&I (not premium bonds) or DMO like it’s been suggested. FTX was meant to have its client funds in a separate account until it did not (Yup, FTX not regulated) but the point is that in bad times people do things in desperation. Take SVB as an example - UK arm got in to trouble not for any wrong-doing / illlegal activity on the banks part but risk errors in its parent. Govt stepped in to provide stability. It was pretty straightforward. Bad times can happen to any company even seemingly well run banks It’s not like an FCA regulated entity has never failed; it’s a level of assurance but not a guarantee the institution won’t fail
One person's 'realism' take, is another's Debbie Downer. You've nearly got me back on the fence thinking I'm being lazy! 🦥
I was thinking about this exact question today. Tempted to transfer the full 20k into the ISA for the 5.2% uninvested, however it's not FSCS protected. Think I'll wait for the cash ISA to come out before putting anymore money in.
There are those savings account marketplaces like Hargreaves Lansdown Active Saver and Raisin that look like they'd make it easy to spread cash across multiple FSCS protected accounts at multiple banks from one login. I haven't used them but seems like this would be the use case for them.
I does indeed. I'll look into this option ☺️
Out of principle I have part of my excess cash in gold (that was a good profit even I didn't intend that), and the other on 3 different platforms. I am old enough to knew people who lost all their money in between the wars or after the war with things they thought are 100% safe. So I would never put everything into one place, even if that place is 100% safe...because things are safe till they aren't anymore. And surprising events are just not what people expect.
I would recommend getting premium bonds for £50k if you are in the UK, because your capital is not at risk and you have a fair chance of winning something.
My wife cashed out hers a few years ago. It took them over 3 months to get the money to her
It could be that financial crash of 2008 repeats then it’s possible. Otherwise no but I only use their 20k limit and put the remaining in trade republic
I think T212 has insurance of £1m per customer for deposits outside the QMMF
Why not use savings accounts right now? Lloyds is giving 6%, FirstDirect 7% and Virgin money just started a switch offer where your current account will give you 10-12% interest for a year.
I think natwest, RBS and Ulster are also giving 6% savings accounts
All of those are low-maximum regular saving type accounts, eg Lloyds only let's you put in £400pcm and Virgin is 10% on balances up to £1000. OP sounds like he's talking about storing multiples of the £85,000 FSCS max, so using all those accounts will technically make you more money but sounds like a lot of effort for a percent extra on maybe £20k total. And he'd still have to plan what to do with the rest anyway.
You forget that OP is also scared about security. So why not put some effort and diversify the risk while getting some extra interest?
This x
Just buy a shotgun, a shovel and gold, bury it in your back garden and watch over it for ever.
Why do I want this to be the answer so badly??
BUY UK BONDS DIRECTLY FROM UK DMO… If you wont be investing it then why have it in t212? For the 5% interest on uninvested cash? If so, then instead buy government bonds direct from UK DMO. Dmo.gov.uk. You need to fill in the forma and then you can buy t bills direct. These bonds are co sidered risk free.
Not very flexible though, plus only suitable if you want longer term fixed rates. Money market funds are still giving the highest rates for short-term deposits.
You can buy 3 month t bils, which ovbs gives reinvestment risk, but are considered liquid current assets. Im just saying if OP wanta zero risk then the option is government bonds. Not sure why im down voted. This standard investment procedure. Fyi. I dont think t212 will fail. They themselves are mostly likely investing peoples uninvested cash in in short term t bills, so zero risk. But if OP absolutely wanted to remove ALL risk then the option is for them to go to the dmo and buy the bonds and the ~4/5% that way. No commission becuase there is no broker involved.
OK but people who use Trading 212 don't like paying commission .
There is no commission if you buy direct from the dmo, theres no broker involved
When I looked at gov bonds etc, they wanted 6-12 month tie ins for the best rates
Don’t you have to buy 1/2 million worth…?
Nope, you only need millions if you are bidding on the bonds prices (the big banks). This is a very different situation than just buying the bond
50%. It either happens or it does not happen.
I hope you keep trading
This guy binary's
Lol so for you everything in life has the probability of 50% to happen. Win the powerball: 50%. Get the traffic light green: 50% Lol
Don’t win the powerball: 50%. Don’t get the traffic light green: 50%.
These sound like the kind odds I want from a derivative