Good money markets instruments to invest in?

Discussion in 'Trading' started by losemind, Mar 17, 2011.

  1. losemind


    Lets say you invest most of your funds into stock market. And in bad times, you would want to sell your stocks and put money into "safer" assets... what are the investable "safer" assets?

    For example, where do you buy risk free bonds? Any better ones?
  2. there is no such thing as a risk free bond. cds up to fdic limits are the only thing risk free.
    i use ally to park cash. they have a no penalty cd. but i wish there was an easier way to transfer money. they make you do the fax letter and then wait 3 day routine to wire money to a broker.
  3. US treasury notes and bonds, money market funds like FSLXX and VMMXX, or ETFs like BIL

    or regular ole bank deposits
  4. Roark


    You could go long AUD. IB will pay you about 4% interest on that for amounts over 12,000.
  5. There is very little or nothing that is risk free that will pay much of course.

    One thing I like to put money into to try and get a better return is CEFs (Closed End Funds). You can find alot about them at

    There are CEFs that invest mostly in bonds, some invest in stocks (and often do covered calls, etc.). There are differences of course among how risky of bonds they invest in, whether they just do Govt. bonds or Corporate bonds, domestic or foreign, etc.

    Many of them pay dividends monthly which I like, and some pay quarterly. Also, they all have a NAV (Net Asset Value), which theoretically at least is the correct value of the fund, but since they actually trade during the day, they can trade above or below the NAV. When they are trading below the NAV, they are said to be at a "discount" - over the NAV, they are trading at a "premium".

    Again, there is risk - view the 5 Yr charts when possible to see how much they went down around the Lehman collapse time. Most have recovered quite a bit since then, but if you needed your money during those times, they wouldn't have been so good be holding. So, these aren't money markets by any means, but they can be good income while you wait for whatever you wanted to do with your money.

    Currently I'm long CSP and HYF.