# Fiscal cliff + Cash in Brokerage Account



## arc (May 19, 2012)

With the fiscal cliff situation, I am parking most of my money in cash in my brokerage account ~40k and 2k in TFSA in cash. Any suggestions on what to put the money into while I wait for the volatility to blow over? or any interesting strategies?


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## Jon_Snow (May 20, 2009)

I hear you.

200k cash in TDW brokerage account.

Another 10k cash between my wife and I in our TFSA and RRSP accounts.

Not to mention 40k in our HISA.

Umm... Cash is King? (sure as hell hope so)


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## Doug2000 (Apr 6, 2011)

In the same vote, just closed a poorly performing employer plan and transferred to my Royal account, not sure what to do, buy now, or wait till the new year. 

Going dividend couch potatoe with some riskier high dividend payers for fun.


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## arc (May 19, 2012)

I thinking of bond trading for now: TRANSCANADA PIPELINE 5.65% Jan 15, 2014
89353ZBM9

thoughts on this? or prehaps a REIT ETF or Bond ETF for the time being?

thanks


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## GoldStone (Mar 6, 2011)

5.65% is the coupon. You will be buying the bond at a premium, so your Yield To Maturity will be much lower (in line with the GICs of a similar maturity).

Bond quote shows bid YTM and ask YTM. Ask YTM is what you will get if you buy this thing.


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## Lephturn (Aug 31, 2009)

I think if Greece gets a bit sorted out and a fiscal cliff deal gets done things have a good chance to rally nicely into year end. I think it likely both of these things happen - we already got the US election out of the way, but there is concern over what that means for interest and dividend tax treatment - if that gets clarified and they don't do anything nasty (like make dividends=income for tax purposes) the way is cleared for a nice rally. I am positioning based on this projection, but with protection in case I'm wrong.

I do not want to be in cash right now with federal gov't all over the globe printing money to infinity - I'm deploying it while things are down and buying protection.


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## Cal (Jun 17, 2009)

Why wait for it to blow over. Buy when the media is hyping everything as the end of the world, when equities are worth buying. The Republicans don't want to be the ones who cause another recession. They will argue, but it will get solved.


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## zylon (Oct 27, 2010)

arc said:


> ... or any interesting strategies?


No interesting strategies here - same old, same old. 
There's always something to worry about.

This snip is from PH&N 2012 Q3 report (page 9 in the pdf).
https://www.phn.com/portals/0/pdfs/FormsandDocuments/quarterly_core.pdf
- may take a minute to load.


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## james4beach (Nov 15, 2012)

I'm also heavy in cash, but that's basically because I'm a bond guy and I don't see any attractive prices in bonds right now. Bond yields are ridiculously low since October.

Cash and GICs aren't so bad. The banks all have savings accounts available for 1.2% to 1.35% (pc financial = cibc) or 2.0% at some credit unions.

Within the discount brokerage, I'm using these "investment savings account" products. The one from TD is mutual fund code TDB8150 and earns 1.25%, with no trading fees or MER.

From the prospectus, my understanding is that the broker opens one big savings account (under the broker's name) at the bank. You then have your share of the savings pool. They are apparently CDIC insured (up to usual max), but to be honest this structure is new and it makes me nervous... is anyone else familiar with these things?


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## webber22 (Mar 6, 2011)

^^^
I use the TDB8150 all the time, there are numerous threads about these types of accounts, I posted this in one of the threads:
The four accounts (TDB8150 TDB8155 TDB8157 TDB8159) represent 4 separate entities for CIDC insurance purposes, so one person can hold $400k in insured HISAs (and 400k more in a joint account)
The $10 NAV also allows for margin flexibility similar to money market funds


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## jcgd (Oct 30, 2011)

Cal said:


> Why wait for it to blow over. Buy when the media is hyping everything as the end of the world, when equities are worth buying. The Republicans don't want to be the ones who cause another recession. They will argue, but it will get solved.


I would agree. I've been piling all the cash I can find into the market over the last few weeks. My cash position is getting pretty tiny.


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## dogcom (May 23, 2009)

Once the fiscal cliff is solved then the attention will turn to the debt ceiling in 2013 and possible downgrades of US debt again.


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## Cal (Jun 17, 2009)

jcgd said:


> I would agree. I've been piling all the cash I can find into the market over the last few weeks. My cash position is getting pretty tiny.


Energy really seems to be getting hammered this time around. I guess some figure resources will not be in demand if there is a recession.

I say back the truck up, this will all blow over.


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## wwwkp84 (Sep 7, 2012)

For those doing regular contributions into a couch potato type strategy, doesn't it make sense to keep with the regularly timed contributions to ride the market's up's and down's ? Long term the market generally goes in a upward direction. Keeping in cash, you lose out?

I will continue on buying every month as I normally do.


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## Sampson (Apr 3, 2009)

wwwkp84 said:


> For those doing regular contributions into a couch potato type strategy, doesn't it make sense to keep with the regularly timed contributions to ride the market's up's and down's ? Long term the market generally goes in a upward direction. Keeping in cash, you lose out?.


Yes, unless you believe you can time the market effectively and consistently.


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## dogleg (Feb 5, 2010)

Even ING's one year GIC at 2% looks pretty good right now.


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## jcgd (Oct 30, 2011)

Plus ING has that deal where if you put $5000 in a GIC they will throw in an extra $50 bucks. So you effectively get 3%.


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## dogleg (Feb 5, 2010)

Sampson said:


> Yes, unless you believe you can time the market effectively and consistently.


 But that would almost take a miracle wouldn't it ?


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## Sampson (Apr 3, 2009)

Odds certainly are against you with regards to timing. Well the majority can't do it anyway.


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## Jon_Snow (May 20, 2009)

Well, waiting for things to drop further was getting tedious so I spent some of the "cash stash" - bought some IMG, SU, PBN, and AAPL - these look like relative bargains to me, although I was hoping SU would approach $30.

Still have lots of dry powder in reserve however...


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## dogleg (Feb 5, 2010)

Jon_Snow said:


> Well, waiting for things to drop further was getting tedious so I spent some of the "cash stash" - bought some IMG, SU, PBN, and AAPL - these look like relative bargains to me, although I was hoping SU would approach $30.
> 
> Still have lots of dry powder in reserve however...


 Damn! And I've been waiting for SU to go to $40 so I can sell some of it. Bad Karma here.


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