On Friday, I moved more cash from my money market fund to a 3-month 5.41% APY CD, similar to what I did previously with some CDs over at Schwab. The yield is a full percentage point above what I’m getting at my MMF. My plan is to see what the Fed decides and to re-evaluate my positions in October when my CDs mature.
One commenter pointed out that the 3-month CD would be a good investment vehicle assuming the cash isn’t needed immediately. But even if you need more liquidity, there are usually several banks offering competitive savings account rates, such as Citibank, Emigrant Direct, and HSBC. Emigrant Direct’s 5.15% APY savings account (aff) with no minimum to open is currently the best around.
It’s not necessarily my intention to stay in cash for a long time, but until I can find worthy investment vehicles, it’s great to be able to get this type of return (even if higher rates often go hand-in-hand with higher inflation).
In the meantime, I plan to start experimenting a bit with special situations investing (or as Graham termed them, “workouts”) starting with the information provided by George at Fat Pitch Financials. With his permission, I’ll discuss some of my experiences with this type of investing here.