SIPP Strategy

Wivelrod

Hello

Can anyone guide me on the following? I am intending to set up a SIPP before the end of this tax year. I want to contribute a lump sum before the end of the tax year, initially into a cash account in the SIPP. I will then gradually invest the lump sum in various ETFs over the course of the 09/10 tax year.

I read somewhere that it may be better putting the cash into a "cash ETF" where the ETF's holdings are deposited on the 3 month money market. After deducting the ETF's 0.15% AMC the return is better than depositing the cash into the SIPPs cash account. The ETF ticker quoted was XSTR, although I cannot find this. Does anyone have any views on this strategy, please?

Appreciate any views.

Cheers

Wivelrod

EdInvestor

The trouble with "cash-like" investments in pensions is that they can carry appreciably more risk.For instance, recently investors in Standard life's "cash" fund were shocked when it lost 5% in value overnight, being partially invested in mortgage backed securities. As long as you know the reason for the better returns, they are fine.