Where to park cash in Fidelity?

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rgs92
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Where to park cash in Fidelity?

Post by rgs92 »

Is there any place in Fidelity that would function as a high yield savings account or money market fund? I've been using SPRXX (their Fidelity Money Market fund) but the yield is tiny (.23 % now).

It is annoying to have to use Ally or Marcus to place cash savings, so I wonder why Fidelity or other big financial firms don't have a decent option.
{edit: I see that the Vanguard Prime money market fund also yields just .4 %, so that's not much better.}
Last edited by rgs92 on Tue May 19, 2020 12:39 pm, edited 4 times in total.
orlandoman
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Re: Where to park cash in Fidelity?

Post by orlandoman »

Moved mine out of Fidelity to Ally ... yes, Fidelity MM rates are about 0.01 now.
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ruralavalon
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Re: Where to park cash in Fidelity?

Post by ruralavalon »

rgs92 wrote: Tue May 19, 2020 12:23 pm Is there any place in Fidelity that would function as a high yield savings account or money market fund? I've been using SPRXX (their Fidelity Money Market fund) but the yield is tiny. There seems to be no equivalent to VMMXX (Vanguard's Prime money market fund).

This is an annoyance that makes Vanguard seem like a better choice than Fidelity.

Thanks.
You are right, that is one of the disadvantages of Fidelity or Schwab compared to Vanguard.

Instead of a money market fund at Fidelity you could consider iShares Ultra Short-Term Bond ETF (ICSH) current SEC Yield = 1.59%.
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Topic Author
rgs92
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Re: Where to park cash in Fidelity?

Post by rgs92 »

Thank you. I considered ultrashort bond funds/ETFs like ICSH (Ishares ultrashort bond fund) but they are surprisingly volatile, with a dip from 50.50 to 48.56 in March. That's not really acceptable in money market fund as I see it. Am I wrong here? Thank you.
ericcohen
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Re: Where to park cash in Fidelity?

Post by ericcohen »

There are some good money market funds to hold cash in at Fidelity. To find the best rates you need to run a screener search for money market funds, then look at the 7 day yields and minimums. It will often depend on how much cash you have to meet the minimum.

Click on "News and research">Mutual Funds. Filter by "class or category money market." Also, you can search by "fidelity funds only" and "no transaction fee" to narrow down the choices.

:sharebeer
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rgs92
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Re: Where to park cash in Fidelity?

Post by rgs92 »

OK, thank you, I'll drill down a little deeper into Fidelity. This is why I hold onto my 401Ks instead of rolling them over into Fidelity or even Vanguard, as the Stable Value funds pay a bit more than Ally or similar.

I would think there would be an ETF that would function as a high-yield savings account. I bet there would be a demand for this.
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Re: Where to park cash in Fidelity?

Post by AAA »

rgs92 wrote: Tue May 19, 2020 12:23 pmIt is annoying to have to use Ally or Marcus to place cash savings, so I wonder why Fidelity or other big financial firms don't have a decent option.
I've wondered about this myself. Why can't Vanguard, Fidelity, etc. match Ally, Marcus, etc. for decent cash yields? Does it have to do with the latter being banks? If so, why?
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rgs92
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Re: Where to park cash in Fidelity?

Post by rgs92 »

Yep, this seems to be a big deficiency in these days of near-negative interest rates when one may be leery of big positions in bond funds.

I wish there was a target or balanced index fund that just used high-yield savings for the fixed income portion.

There seems to be no such product.

The only way to replicate this is to use a 401K (or the like) with a stable value fund with frequent re-balancing. I feel this is a good reason to avoid rolling over a 401K if the investment choices are good (low cost index funds).
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Re: Where to park cash in Fidelity?

Post by Pocanutin »

Fidelity is not a bank, but a brokerage; thus cannot offer high yield savings.
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ruralavalon
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Re: Where to park cash in Fidelity?

Post by ruralavalon »

I don't think it's reasonable to expect a fund company to also be a bank.
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Re: Where to park cash in Fidelity?

Post by nix4me »

Put 90% in the money market earning whatever and put 10% in ITOT total market ETF. Or use a bond fund.
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Re: Where to park cash in Fidelity?

Post by dcdowden »

I was using ICSH as well, but got nervous because it was all corporate debt in these strange times. So I moved money into CD's with FDIC insurance and iShares GNMA fund that is backed by the US Government, although certainly still subject to interest rate and other risks.
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Re: Where to park cash in Fidelity?

Post by mega317 »

What is the money for? How much? If it's a large position you're going to keep a while, like a beefed up emergency fund, it might be worth the annoyance. If tiny or temporary, then it doesn't matter what you do. More info please.
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FlyerJack
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Re: Where to park cash in Fidelity?

Post by FlyerJack »

Pocanutin wrote: Tue May 19, 2020 12:58 pm Fidelity is not a bank, but a brokerage; thus cannot offer high yield savings.
Fidelity could offer a similar product, or use banks to do so, through cash management accounts.
ruralavalon wrote: Tue May 19, 2020 1:05 pm I don't think it's reasonable to expect a fund company to also be a bank.
Schwab and others pull it off. No reason Fidelity couldn’t do the same, even more than it’s already doing with CMA. If Fidelity thought it was worthwhile, which apparently it doesn’t.

Personally, though, I have no problem transferring money back and forth between Ally and Fidelity. Best of both worlds.

ETA: Turns out this is a popular question; if you use the search function, you can read numerous threads asking where to “park” cash at Fidelity.
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Re: Where to park cash in Fidelity?

Post by ruralavalon »

FlyerJack wrote: Tue May 19, 2020 3:49 pm
Pocanutin wrote: Tue May 19, 2020 12:58 pm Fidelity is not a bank, but a brokerage; thus cannot offer high yield savings.
Fidelity could offer a similar product, or use banks to do so, through cash management accounts.
ruralavalon wrote: Tue May 19, 2020 1:05 pm I don't think it's reasonable to expect a fund company to also be a bank.
Schwab and others pull it off. No reason Fidelity couldn’t do the same, even more than it’s already doing with CMA. If Fidelity thought it was worthwhile, which apparently it doesn’t.
Schwab also offers poor yield on it's money market funds.

FlyerJack wrote: Tue May 19, 2020 3:49 pmPersonally, though, I have no problem transferring money back and forth between Ally and Fidelity. Best of both worlds.

ETA: Turns out this is a popular question; if you use the search function, you can read numerous threads asking where to “park” cash at Fidelity.
I use Vanguard funds and Vanguard accounts for investing, and use a bank with a branch near our home for banking functions like debit card and checking account.
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Re: Where to park cash in Fidelity?

Post by Kevin M »

ericcohen wrote: Tue May 19, 2020 12:39 pm There are some good money market funds to hold cash in at Fidelity.
Really? If by "good" you mean ones that provide yields that are competitive with high-yield savings accounts, then I don't think this is the case.

SPRXX yield is 0.19%, and all of the Fido government fund yields are 0.01%. FZDXX yield is 0.31%, but requires $100K to open in taxable ($10K in IRA), but this yield will continue to decline toward 0.01% in coming weeks, so still not much good.

I use FZDXX in IRAs at Fidelity unless I want to bother doing an IRA transfer to a bank or credit union to pick up a decent IRA CD, which does happen from time to time. It's not "good", but it's the least bad for a MM fund at Fidelity.

Also put some in ICSH. It did drop more than expected in March, but some of that drop was price only, not NAV. There was a big disconnect between price and NAV for some bond fund ETFs during the liquidity crunch. It was much worse for NEAR and FLOT, some shares of which I also had picked up shortly before the crunch. At one point one of them had a price discount of about 10% compared to NAV--if I had been paying more attention, I think I would have bought more during the crunch.

I am still down a bit more than 1% for FLOT and NEAR, but am slightly in the black with ICSH.

Kevin
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protagonist
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Re: Where to park cash in Fidelity?

Post by protagonist »

I also use FZDXX. Requires a high initial deposit but you need not maintain the balance.
It used to be quite competitive with online banks, but no longer. So now I keep up to about $10K in FZDXX for expenses (I use Fidelity as my main checking account), and the rest in a high yield online account from which I can easily transfer funds to Fidelity when needed.
Last edited by protagonist on Tue May 19, 2020 5:45 pm, edited 3 times in total.
mervinj7
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Re: Where to park cash in Fidelity?

Post by mervinj7 »

protagonist wrote: Tue May 19, 2020 5:20 pm I also use VZDXX. Requires a high initial deposit but you need not maintain the balance.
It used to be quite competitive with online banks, but no longer. So now I keep up to about $10K in VZDXX for expenses (I use Fidelity as my main checking account), and the rest in a high yield online account from which I can easily transfer funds to Fidelity when needed.
I think you meant FZDXX. Current yield is 0.31%. Slightly better than SPRXX's 0.19%.
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Re: Where to park cash in Fidelity?

Post by protagonist »

mervinj7 wrote: Tue May 19, 2020 5:36 pm
I think you meant FZDXX. Current yield is 0.31%. Slightly better than SPRXX's 0.19%.
YES. FZDXX. Stupid error. I corrected it. Thank you for pointing that out.
I keep the remainder in SFGI Direct (1.56% current yield).
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Re: Where to park cash in Fidelity?

Post by drummerboy »

FlyerJack wrote: Tue May 19, 2020 3:49 pm Fidelity could offer a similar product, or use banks to do so, through cash management accounts.
Fidelity does offer something (where they have partnered with other banks to provide the deposit accounts). Unfortunately, the yields are not good.
FlyerJack wrote: Tue May 19, 2020 3:49 pm Schwab and others pull it off. No reason Fidelity couldn’t do the same, even more than it’s already doing with CMA. If Fidelity thought it was worthwhile, which apparently it doesn’t.
Schwab does own a bank (Schwab Bank), but Schwab has made a business decision to pay for their operations through the spread on what they pay in interest vs. what they earn. If they didn’t do this, they would have to charge fees for something else to generate revenue.

I have to transfer funds too to Marcus and Ally to get acceptable yields for cash. Not perfect, but if it’s cash I’m holding for 1-2 years, this is a safe and effective way to earn something. The transfer only takes 1 day from my Schwab accounts.
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Re: Where to park cash in Fidelity?

Post by ericcohen »

Kevin M wrote: Tue May 19, 2020 4:57 pm
ericcohen wrote: Tue May 19, 2020 12:39 pm There are some good money market funds to hold cash in at Fidelity.
Really? If by "good" you mean ones that provide yields that are competitive with high-yield savings accounts, then I don't think this is the case.

SPRXX yield is 0.19%, and all of the Fido government fund yields are 0.01%. FZDXX yield is 0.31%, but requires $100K to open in taxable ($10K in IRA), but this yield will continue to decline toward 0.01% in coming weeks, so still not much good.

I use FZDXX in IRAs at Fidelity unless I want to bother doing an IRA transfer to a bank or credit union to pick up a decent IRA CD, which does happen from time to time. It's not "good", but it's the least bad for a MM fund at Fidelity.

Also put some in ICSH. It did drop more than expected in March, but some of that drop was price only, not NAV. There was a big disconnect between price and NAV for some bond fund ETFs during the liquidity crunch. It was much worse for NEAR and FLOT, some shares of which I also had picked up shortly before the crunch. At one point one of them had a price discount of about 10% compared to NAV--if I had been paying more attention, I think I would have bought more during the crunch.

I am still down a bit more than 1% for FLOT and NEAR, but am slightly in the black with ICSH.

Kevin
Kevin, the last I had a significant amount of cash to park I used FZDXX. That was over a year ago. And when I looked, the yield offered by that money market fund was comparable yield to Vanguard Prime Money Market. (I remember checking at the time). Now I have very little in cash and I use SPAXX. To be honest, I don't look at the rate since I have about $10 in there right now. :D Rates have declined a lot since then. But that is across the board, not just Fidelity MM funds. I would be surprised if there is a big difference in yield between Fidelity MM and other MMs.

Of course, if you want CD rates, you need to buy a CD, not a MM fund. Same with bond funds. If you want to take the risk of a bond fund, you'll get compensated more than for a MM fund. You can buy CDs and Bond funds through fidelity too if that is what you want. There is a trade off of course. I thought the OP was looking for better MM funds then SPAXX on Fidelity. And it is correct to say that there are better. And I provided him a way of searching for them.

:sharebeer
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Re: Where to park cash in Fidelity?

Post by Leif »

I also wished they offered a high yield option. Fidelity offers checks and check cashing, thru their associated bank, but not HY. Perhaps they don't want the competition with their MM funds. Or perhaps there is not a legal framework to get FDIC accounts. So we need to do the dance, if we care about the yield difference, of transferring money back and forth.
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Re: Where to park cash in Fidelity?

Post by ChiKid24 »

I'm in the process of moving $50k of my emergency fund out of Fidelity FZDXX and into Capital One 360 Savings. Interest rate is 1.5% and they are paying a $100 bonus for every $10,000 you deposit (up to $500 bonus). Must be a new customer and deposit must be made within 10 days of opening the account. I'll earn $500 bonus plus $750 interest in one year, resulting in Implied interest return (pre-tax) of 2.5% on FDIC insured balance. Money needs to stay in for 90 days to keep the bonus. No monthly fees. Offer expires 5/31.
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Re: Where to park cash in Fidelity?

Post by annu »

ericcohen wrote: Tue May 19, 2020 12:39 pm There are some good money market funds to hold cash in at Fidelity. To find the best rates you need to run a screener search for money market funds, then look at the 7 day yields and minimums. It will often depend on how much cash you have to meet the minimum.

Click on "News and research">Mutual Funds. Filter by "class or category money market." Also, you can search by "fidelity funds only" and "no transaction fee" to narrow down the choices.

:sharebeer
I see 1 fund, FZDXX fidelity money market fund premium class, which has yield of .43%, higher then. O1.....

Thanks for sharing info on looking up....
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Here is Fidelity Best Money Market Fund

Post by annu »

[Thread merged into here, see below. --admin LadyGeek]

I have been in https://fundresearch.fidelity.com/mutua ... /316067107 FDRXX(Fidelity® Government Cash Reserves), the default fund, with a yield of .01%.
Based on a thread here, did some research, and found https://fundresearch.fidelity.com/mutua ... /31617H805 FZDXX(Fidelity® Money Market Fund - Premium Class), with a yield of .31%, so almost 3 times yay..but I have a question on the risk profile.

But looking at the risk profile, even though both funds have at low, I did see in compositon that FZDXX is below, one in bold/color stood out

FDRXX is below composition
U.S. Treasury Bills 2.04%
U.S. Treasury Coupons 5.30%
U.S. Treasury Strips 0.00%
U.S. Treasury Inflation-Protected Securities 2.47%
Agency Fixed-Rate Securities 15.44%
Agency Floating-Rate Securities 26.36%
U.S. Government Repurchase Agreements 49.06%
Other Money Market Investments 0.13%
Net Other Assets -0.80%

FZDXX Composition
U.S. Treasury Debt 0.16%
U.S. Government Agency Debt 0.00%
Non-U.S. Sovereign, Sub-Sovereign, and Supra-National Debt 0.00%
Certificates of Deposit 31.68%
Non-Negotiable Time Deposits 11.46%
Variable Rate Demand Notes 0.41%
Other Municipal Securities 0.05%
Asset Backed Commercial Paper 1.51%
Other Asset Backed Securities 0.00%
U.S. Treasury Repurchase Agreements 5.74%
U.S. Government Agency Repurchase Agreements 11.71%
Other Repurchase Agreements 9.84%
Insurance Company Funding Agreements 0.00%
Investment Companies 0.00%
Financial Company Commercial Paper 26.46%
Non-Financial Company Commercial Paper 0.96%
Tender Option Bonds 0.00%
Other Instruments 0.30%
Net Other Assets -0.28%

It looks like these are from companies and not Govt. So maybe the reason return is higher is due to higher risk? Which is not reflected in the risk profile. I could understand that minimum is $100000, which is a lot, but if that alone is not enough for higher yield, you are taking more risk by using the fund, will like to stay away and stick to what I have currently.

Quick edit, looks in Retirement accounts, you only need $10000, so that will work for me and probably more folks
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Re: Here is Fidelity Best Money Market Fund

Post by FIREchief »

Please be aware, that $100,000 minimum is just the price of admission. Once you have a position, you can drop the balance to anything you want. I don't typically hold $100K cash, but I happened to have a home sale proceeds check that I deposited at my local Fido B&M, and the helpful person there suggested that I run it through FZDXX so that I would have continuing access to that fund. Also, I believe that the minimum is only $10K for retirement accounts (same flexibility regarding minimum balance). I don't worry about risk with any money market fund at a leading brokerage house.
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JoMoney
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Re: Here is Fidelity Best Money Market Fund

Post by JoMoney »

Yes, the higher returns are related to the higher risk. In addition to the higher risk in the securities themselves, the fund is not a 'Government' fund, and could be subject to liquidity fees and redemption gates impacting withdrawals in time of crisis:
https://www.fidelity.com/bin-public/060 ... -funds.pdf

FWIW, the "Financial Company Commercial Paper" is usually banks, often the same banks also included in the holdings of:
Certificates of Deposit 31.68%

While I'm sure it's managed for quality and diversification, you should note that the fund and it's holdings are NOT eligible for FDIC insurance... but you might be comforted by the "too big to fail" status where the government has come to the rescue of many of these banks, and that at that at least somewhat the government is likely to prevent a broad failure of all the banks even if some might go under.
Last edited by JoMoney on Tue May 19, 2020 7:08 pm, edited 3 times in total.
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Re: Here is Fidelity Best Money Market Fund

Post by Leif »

The highest paying MM fund at Fidelity, with $0 min. investment, is SPRXX. It has a 7 day yield of 0.18% and a 1 day yield of 0.13%. Looks like it is headed for 0.01% like the others.
Last edited by Leif on Tue May 19, 2020 7:10 pm, edited 1 time in total.
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Re: Where to park cash in Fidelity?

Post by LadyGeek »

I merged annu's thread into the on-going discussion. The combined thread is now in the Investing - Theory, News & General (general discussion).

(Thanks to the member who reported the post. One of the reasons is "Duplicate thread". Also, thanks for linking to the duplicate - much appreciated.)
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Re: Here is Fidelity Best Money Market Fund

Post by FIREchief »

annu wrote: Tue May 19, 2020 6:50 pm Based on a thread here, did some research, and found https://fundresearch.fidelity.com/mutua ... /31617H805 FZDXX(Fidelity® Money Market Fund - Premium Class), with a yield of .31%, so almost 3 times yay..but I have a question on the risk profile.
FZDXX currently shows a 7 day yield of 0.43%. Not great, but beats a stick in the eye.....
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Re: Where to park cash in Fidelity?

Post by Rosencrantz1 »

ericcohen wrote: Tue May 19, 2020 6:05 pm
Kevin M wrote: Tue May 19, 2020 4:57 pm
ericcohen wrote: Tue May 19, 2020 12:39 pm There are some good money market funds to hold cash in at Fidelity.
Really? If by "good" you mean ones that provide yields that are competitive with high-yield savings accounts, then I don't think this is the case.

SPRXX yield is 0.19%, and all of the Fido government fund yields are 0.01%. FZDXX yield is 0.31%, but requires $100K to open in taxable ($10K in IRA), but this yield will continue to decline toward 0.01% in coming weeks, so still not much good.

I use FZDXX in IRAs at Fidelity unless I want to bother doing an IRA transfer to a bank or credit union to pick up a decent IRA CD, which does happen from time to time. It's not "good", but it's the least bad for a MM fund at Fidelity.

Also put some in ICSH. It did drop more than expected in March, but some of that drop was price only, not NAV. There was a big disconnect between price and NAV for some bond fund ETFs during the liquidity crunch. It was much worse for NEAR and FLOT, some shares of which I also had picked up shortly before the crunch. At one point one of them had a price discount of about 10% compared to NAV--if I had been paying more attention, I think I would have bought more during the crunch.

I am still down a bit more than 1% for FLOT and NEAR, but am slightly in the black with ICSH.

Kevin
Kevin, the last I had a significant amount of cash to park I used FZDXX. That was over a year ago. And when I looked, the yield offered by that money market fund was comparable yield to Vanguard Prime Money Market. (I remember checking at the time). Now I have very little in cash and I use SPAXX. To be honest, I don't look at the rate since I have about $10 in there right now. :D Rates have declined a lot since then. But that is across the board, not just Fidelity MM funds. I would be surprised if there is a big difference in yield between Fidelity MM and other MMs.

Of course, if you want CD rates, you need to buy a CD, not a MM fund. Same with bond funds. If you want to take the risk of a bond fund, you'll get compensated more than for a MM fund. You can buy CDs and Bond funds through fidelity too if that is what you want. There is a trade off of course. I thought the OP was looking for better MM funds then SPAXX on Fidelity. And it is correct to say that there are better. And I provided him a way of searching for them.

:sharebeer
I've bought CDs in my Fidelity IRA. I really like Fidelity overall - especially their customer service. However, it's been my experience that, in general, when it comes to money market accounts or offered CDs, Fidelity really isn't all that competitive. I've got some cash sitting in FZDXX and I've been itching to 'put it to work' because the 0.31% (or whatever it is today) is NOT very appealing. Oh well...
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Leif
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Re: Where to park cash in Fidelity?

Post by Leif »

ChiKid24 wrote: Tue May 19, 2020 6:29 pm I'm in the process of moving $50k of my emergency fund out of Fidelity FZDXX and into Capital One 360 Savings. Interest rate is 1.5% and they are paying a $100 bonus for every $10,000 you deposit (up to $500 bonus). Must be a new customer and deposit must be made within 10 days of opening the account. I'll earn $500 bonus plus $750 interest in one year, resulting in Implied interest return (pre-tax) of 2.5% on FDIC insured balance. Money needs to stay in for 90 days to keep the bonus. No monthly fees. Offer expires 5/31.
Thanks for the tip. I see it, but looks like the APY is 1.3% now.

One other thing I found talking to Cap 1. The bonus is paid 60 days after the qualifying period, which is 90 days. So you should expect the bonus at 90+60=150 days, or 5 months.
Last edited by Leif on Wed May 20, 2020 1:48 pm, edited 2 times in total.
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Re: Where to park cash in Fidelity?

Post by corp_sharecropper »

Maybe I don't have as big of a stock pile of cash as some (by design), but there are exactly ZERO HYS or CD rates out there right now that are worth me lifting a finger to chase. I already feel dirty for having expended the time & energy to type this, 1.X% APY, just not worth the hassle of messing with my setup (happens to be with Fidelity, I'm a "one stop shop" situation, but it really wouldn't matter if I was anywhere else other than the usual suspects, not worth it to MOVE, whether it's to Marcus, Ally, or that super obscure credit union w/ a 1990's website).
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Re: Where to park cash in Fidelity?

Post by Ferdinand2014 »

I buy treasury bills at auction on auto roll.
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Re: Where to park cash in Fidelity?

Post by drzzzzz »

Ferdinand2014 wrote: Tue May 19, 2020 8:57 pm I buy treasury bills at auction on auto roll.
Used to do this and was so easy at Fidelity with auto-roll, but since treasury bills pay nothing these days, high yield savings elsewhere or bank CDs are the plan.
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Re: Where to park cash in Fidelity?

Post by ronin »

These times clearly demonstrate to me why Fidelity won’t serve as a true one-stop shop. Sure, in a different rate environment it’s MM funds may be competitive with HYS offerings elsewhere, but not these days.

Admittedly, I’ve always been a little skeptical of the one-stop shop model. Instead, I think a best of breed on a limited scope seems compelling. It could be as simple as others suggested above by using Fidelity alongside Ally, Marcus, or Capital One.

I would love to see a yield chart plot if Fidelity’s MM funds alongside prominent HYS accounts over the last ten years or so to get a better picture of the differences. Anyone know where to get find this?
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Re: Where to park cash in Fidelity?

Post by JoMoney »

Yes, market rates are extremely low. No good options at a brokerage.
Banks are offering significantly higher yields currently (although they're falling too, just slower).
I had been consolidating things at Fidelity, but with the current disparity between high yield bank accounts and money market funds, I've moved my savings back over to a bank account.
My expectation, is that when rates start to rise, they'll rise faster in the MM funds, the banks will lag behind, and I'll probably be moving back to the MM funds at some point.. but not right now.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham
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JoMoney
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Re: Where to park cash in Fidelity?

Post by JoMoney »

ronin wrote: Tue May 19, 2020 10:02 pm...
I would love to see a yield chart plot if Fidelity’s MM funds alongside prominent HYS accounts over the last ten years or so to get a better picture of the differences. Anyone know where to get find this?
High-Yield Savings accounts vary widely between different banks, different time periods, etc.. Some of them even create new account types. Capital One 360 had a High Yield Money Market account with a good rate, then dropped the rate on that and started promoting a high rate "Performance Savings Account".
Most bank rates are horrible, so even a "broad average" wouldn't give what I think you want.
However, if you go to https://www.depositaccounts.com/savings/ and look at the 'details' for some of the various accounts they're promoting you can see how those specific accounts have changed over time.
Image

For a specific money market fund, like one at Fidelity, you can lookup old SEC filings to find the rate at a specific point in time
https://www.sec.gov/cgi-bin/browse-edga ... cd=filings
The below was from a filing in July of 2019
Image
https://www.sec.gov/Archives/edgar/data ... ry_doc.xml
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham
rascott
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Re: Where to park cash in Fidelity?

Post by rascott »

JoMoney wrote: Tue May 19, 2020 10:03 pm Yes, market rates are extremely low. No good options at a brokerage.
Banks are offering significantly higher yields currently (although they're falling too, just slower).
I had been consolidating things at Fidelity, but with the current disparity between high yield bank accounts and money market funds, I've moved my savings back over to a bank account.
My expectation, is that when rates start to rise, they'll rise faster in the MM funds, the banks will lag behind, and I'll probably be moving back to the MM funds at some point.. but not right now.


Ally has a full scale brokerage. And can still enjoy 1.25% by shifting cash to the savings account. It's a totally seamless operation between bank/ brokerage. I even added a free checking account recently, if I needed to write a check out of brokerage/ savings. Mobile app is good.

Have slowly been consolidating everything there (Roths, taxable, savings) . They do charge a flat $9.95 for mutual fund orders. So not great if you want to use MFs. I mainly use ETFs so not really a concern with $0 commission. Postive side is, of so inclined... they offer a lot of institutional funds that are unavailable at other brokers.

Hoping one day they will offer fractional shares like Fidelity, but that's really the only negative for my use.
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Re: Where to park cash in Fidelity?

Post by jeffyscott »

ruralavalon wrote: Tue May 19, 2020 12:29 pm
rgs92 wrote: Tue May 19, 2020 12:23 pm Is there any place in Fidelity that would function as a high yield savings account or money market fund? I've been using SPRXX (their Fidelity Money Market fund) but the yield is tiny. There seems to be no equivalent to VMMXX (Vanguard's Prime money market fund).

This is an annoyance that makes Vanguard seem like a better choice than Fidelity.

Thanks.
You are right, that is one of the disadvantages of Fidelity or Schwab compared to Vanguard.

Instead of a money market fund at Fidelity you could consider iShares Ultra Short-Term Bond ETF (ICSH) current SEC Yield = 1.59%.
Getting 0.29% from the Vanguard settlement fund doesn't lead me to keep any money in it. Our cash would still be moved to 1.5% savings account or an ultrashort bond fund like VUBFX at Vanguard or FCONX at Fidelity.
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Re: Where to park cash in Fidelity?

Post by jeffyscott »

ruralavalon wrote: Tue May 19, 2020 3:54 pm
FlyerJack wrote: Tue May 19, 2020 3:49 pm
Pocanutin wrote: Tue May 19, 2020 12:58 pm Fidelity is not a bank, but a brokerage; thus cannot offer high yield savings.
Fidelity could offer a similar product, or use banks to do so, through cash management accounts.
ruralavalon wrote: Tue May 19, 2020 1:05 pm I don't think it's reasonable to expect a fund company to also be a bank.
Schwab and others pull it off. No reason Fidelity couldn’t do the same, even more than it’s already doing with CMA. If Fidelity thought it was worthwhile, which apparently it doesn’t.
Schwab also offers poor yield on it's money market funds.
And Schwab Bank offers poor yields on savings, too. Schwab Bank High Yield Investor Savings account is currently paying 0.05%.
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indexfundfan
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Re: Where to park cash in Fidelity?

Post by indexfundfan »

I don't believe the Schwab Bank High Yield Investor Savings account has ever been competitive. Perhaps it should be renamed "Low Yield Savings Account".
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Re: Where to park cash in Fidelity?

Post by ronin »

JoMoney wrote: Tue May 19, 2020 10:18 pm
ronin wrote: Tue May 19, 2020 10:02 pm...
I would love to see a yield chart plot if Fidelity’s MM funds alongside prominent HYS accounts over the last ten years or so to get a better picture of the differences. Anyone know where to get find this?
High-Yield Savings accounts vary widely between different banks, different time periods, etc.. Some of them even create new account types. Capital One 360 had a High Yield Money Market account with a good rate, then dropped the rate on that and started promoting a high rate "Performance Savings Account".
Most bank rates are horrible, so even a "broad average" wouldn't give what I think you want.
However, if you go to https://www.depositaccounts.com/savings/ and look at the 'details' for some of the various accounts they're promoting you can see how those specific accounts have changed over time.
Image

For a specific money market fund, like one at Fidelity, you can lookup old SEC filings to find the rate at a specific point in time
https://www.sec.gov/cgi-bin/browse-edga ... cd=filings
The below was from a filing in July of 2019
Image
https://www.sec.gov/Archives/edgar/data ... ry_doc.xml
Thanks for sharing this JoMoney! I wish there was a nice chart plotting out the historic MM rates to compare to the HYS.

Overall, is it generally true that in down-rate environments HYSs lag meaning they stay higher longer than MM funds, but it goes the opposite way in an up-rate environment?
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Re: Where to park cash in Fidelity?

Post by radiowave »

rascott wrote: Tue May 19, 2020 10:53 pm
JoMoney wrote: Tue May 19, 2020 10:03 pm Yes, market rates are extremely low. No good options at a brokerage.
Banks are offering significantly higher yields currently (although they're falling too, just slower).
I had been consolidating things at Fidelity, but with the current disparity between high yield bank accounts and money market funds, I've moved my savings back over to a bank account.
My expectation, is that when rates start to rise, they'll rise faster in the MM funds, the banks will lag behind, and I'll probably be moving back to the MM funds at some point.. but not right now.


Ally has a full scale brokerage. And can still enjoy 1.25% by shifting cash to the savings account. It's a totally seamless operation between bank/ brokerage. I even added a free checking account recently, if I needed to write a check out of brokerage/ savings. Mobile app is good.

Have slowly been consolidating everything there (Roths, taxable, savings) . They do charge a flat $9.95 for mutual fund orders. So not great if you want to use MFs. I mainly use ETFs so not really a concern with $0 commission. Postive side is, of so inclined... they offer a lot of institutional funds that are unavailable at other brokers.

Hoping one day they will offer fractional shares like Fidelity, but that's really the only negative for my use.
Is there a way to see what mutual funds Ally is offering without having to open an account?

tnx
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rascott
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Re: Where to park cash in Fidelity?

Post by rascott »

radiowave wrote: Wed May 20, 2020 9:15 am
rascott wrote: Tue May 19, 2020 10:53 pm
JoMoney wrote: Tue May 19, 2020 10:03 pm Yes, market rates are extremely low. No good options at a brokerage.
Banks are offering significantly higher yields currently (although they're falling too, just slower).
I had been consolidating things at Fidelity, but with the current disparity between high yield bank accounts and money market funds, I've moved my savings back over to a bank account.
My expectation, is that when rates start to rise, they'll rise faster in the MM funds, the banks will lag behind, and I'll probably be moving back to the MM funds at some point.. but not right now.


Ally has a full scale brokerage. And can still enjoy 1.25% by shifting cash to the savings account. It's a totally seamless operation between bank/ brokerage. I even added a free checking account recently, if I needed to write a check out of brokerage/ savings. Mobile app is good.

Have slowly been consolidating everything there (Roths, taxable, savings) . They do charge a flat $9.95 for mutual fund orders. So not great if you want to use MFs. I mainly use ETFs so not really a concern with $0 commission. Postive side is, of so inclined... they offer a lot of institutional funds that are unavailable at other brokers.

Hoping one day they will offer fractional shares like Fidelity, but that's really the only negative for my use.
Is there a way to see what mutual funds Ally is offering without having to open an account?

tnx
I recall seeing a general list of fund families they offered. But having trouble finding it.

There something specific you are looking for?
lws
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Re: Where to park cash in Fidelity?

Post by lws »

Glad I did not rollover the 401k. The stable value option came in handy.
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Re: Where to park cash in Fidelity?

Post by radiowave »

rascott wrote: Wed May 20, 2020 10:08 am
I recall seeing a general list of fund families they offered. But having trouble finding it.

There something specific you are looking for?

Well if I could get Vanguard total stock VTSAX at VG expense ratio, that would be great.
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rascott
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Re: Where to park cash in Fidelity?

Post by rascott »

radiowave wrote: Wed May 20, 2020 2:32 pm
rascott wrote: Wed May 20, 2020 10:08 am
I recall seeing a general list of fund families they offered. But having trouble finding it.

There something specific you are looking for?

Well if I could get Vanguard total stock VTSAX at VG expense ratio, that would be great.
You can buy VTSAX for $9.95 transaction fee.

Or VTI for $0 :D
statefan03
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Re: Where to park cash in Fidelity?

Post by statefan03 »

^ why when you can get the same thing for ER 0.015. FSKAX
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Re: Where to park cash in Fidelity?

Post by statefan03 »

To the original topic, a couple funds to consider.

FIPDX - tips
FUMBX - short term treasuries
FUAMX - intermediate treasuries

all would be state tax exempt.
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