Home for Excess Cash

chiang_mai

I’m looking for a home for my excess cash, instead of leaving it in MM. My equities allocation is at its ceiling of 37% plus I already hold 26% in short and intermediate corporate bond funds. A couple of low risk MA funds account for a further 16%, which leaves 20% to decide on.

I’m unlikely to need the cash but it should remain available in a liquid form, rather than committed for a period of time. I think that splitting the funds, around 25% in a short/intermediate bond fund such as Blackrock 1-10, and,75% in Vanguard’s Global Short Term Bond Index, makes sense to me.

My priorities are, a) low risk b) liquidity, and c) a return that beats MM.

I’m not keen on buying individual gilts but I did consider the RL short term gilts fund. I also considered VAGS and the VG Investment grade bond fund, all of which I decided against.

If anyone has any strong reasons why the above is not a good idea or can be substantially improved, I’ll be very happy to hear.

InvesterJones

RL do a range of funds which add in short dated fixed bonds to the MM-like investments to nudge the return a little higher than MM e.g. RL short term fixed income and fixed income enhanced. Both have a focus on liquidity and low risk.