|
|
In and something quite important happened in European economic policy, interest rates were positive again after years of being negative or zero. This rate increase completely changes the situation of the personal finances of all Spaniards and Europeans, it is more expensive to go into debt, but you can obtain profitability without risk again through savings.
This rate hike coincided with the rate hike of the US Federal Reserve and other smaller economies, such as the United Kingdom. The changes came mainly due to the inflation caused by the reactivation of the economy after the end of the Covid quarantines and the shortage caused by the Russian invasion of part of the Ukrainian territory.
At this time, Spanish consumers expected to once again receive some interest on our liquidity in the account and even contract deposits again, perhaps even deposits in kind. But it didn't happen. Only smaller and foreign banks began to offer these products. This has made Spanish savers begin to look at alternatives, including monetary funds.
What is a monetary fund?
A monetary fund is a type of investment fund that focuses on short-term, high liquidity and low risk financial assets. These funds seek to offer investors a safe and stable option, similar to a savings account, but with the possibility of obtaining better returns. Monetary funds invest primarily in money market instruments, such as treasury bills, certificates of deposit, commercial paper, UK Email List and short-term debt obligations issued by companies or governments.
Millionaires no longer create accounts in Switzerland, they now hide their assets in these other countries
ON THE SALMON BLOG
Millionaires no longer create accounts in Switzerland, they now hide their assets in these other countries
Monetary funds have the following characteristics:
Security: Monetary funds seek to maintain the security of the invested capital. Above profitability. However with the low interest rates we have had and the high fees, that has not been exactly true.
Liquidity: Monetary funds allow easy access to funds as they can be withdrawn relatively easily. The order is given at the bank and in one or two days we have the money in our account.
Return: Monetary funds offer a moderate return, generally higher than that of a traditional savings account, but lower than that of other types of investment funds that assume greater risks.
Low volatility: Monetary funds have a lower risk of significant fluctuations in the value of their capital, due to their short term and the solvency of the issuers. Of course, as long as we take into account that it is the same currency, if we invest in a monetary fund in a different currency, we will run greater risk and volatility.
Monetary funds can be a good option for very conservative investors or as a safe haven or transition asset. However, they also have some drawbacks, such as changes in interest rates that can affect their performance or the fees charged for their management and deposit. Sometimes these are so high that they “eat up” the profitability of the monetary fund, so choosing them well is very important. Especially in the current context of early where it seems that interest rates are going to lower again.
Why a monetary fund and not stocks or deposits?
Let's start with stocks , although their long-term profitability is higher, their short-term volatility is quite high. In my case, the mattress is designed to cover my expenses for twelve months, not to give me profitability, so its amount is fixed. If I invest in stocks whose value can fluctuate quite a bit in the short term, I run a risk in case I need the cushion. So I want something that protects me better against inflation than an account that pays nothing or almost nothing.
|
|
发表于 2024-2-15 13:03:33