Cash Management Funds: A Smart Way to Boost Returns on Idle Cash

Key Takeaways

Cash management funds provide daily liquidity, making funds easily accessible when needed.
They often offer better returns compared to traditional savings accounts, even in low-interest-rate environments.
They are generally low-risk, investing in high-quality, short-term debt instruments.

Cash management mutual funds can be an attractive solution for investors looking to park their money temporarily while exploring long-term investment opportunities. These funds provide liquidity and modest returns on idle cash, making them a flexible choice for those who want to keep their funds accessible without sacrificing growth potential.

Key Benefits of Cash Management Mutual Funds

Liquidity

Cash management funds offer daily liquidity, allowing investors to access their funds quickly, much like a savings account. This makes them suitable for managing cash while earning returns.

Higher Returns

Typically, cash management funds offer higher returns compared to traditional savings accounts, which may have lower interest rates tied to central bank policies. While not guaranteed, returns are usually more competitive due to the nature of their underlying investments.

Diversification

These funds invest in a basket of short-term instruments, reducing the risk associated with relying on a single investment type.

Low Risk

Since they invest in high-quality, short-term debt instruments, they are a low-risk option for conservative investors. This makes them a relatively safe place to hold cash while you evaluate other investment opportunities.

Comparing Cash Management Funds to GICs and Savings Accounts

Guaranteed Investment Certificates (GICs)

GICs provide a fixed interest rate and guarantee the return of the principal but often require you to lock in your money for a set period (ranging from a few months to several years). While GICs offer certainty, they lack the liquidity of a cash management fund, where funds are readily accessible.

Savings Accounts

While highly liquid, savings accounts generally offer lower returns than cash management funds, especially in low-interest-rate environments. While savings accounts are insured (through institutions such as CDIC), they may not keep pace with inflation or provide meaningful growth while you're exploring investment options.

Cash management mutual funds may be a great option for investors looking to optimize returns on idle cash without sacrificing liquidity. They provide a middle ground between the higher returns of GICs (but without the lock-in) and the ease of access found in traditional savings accounts (but with the potential for better returns). While not risk-free, they offer a diversified, flexible way to manage cash efficiently while you assess future investment decisions.

NPP119

(Series F)

Ninepoint Cash Management Fund

Mutual Funds Exchange Traded Funds Cash Strategies

$10.00 $0.00 (0.01%)

As at 10/25/2024

Growth of $10,000 Invested as at 9/30/2024

Performance as at 9/30/2024

1 Year
5.20%

3 Year
3.79%

5 Year
2.64%

10 Year
2.09%

Incept.¹
2.06%

¹ Inception Date 8/5/2010

Go To Fund

Effective September 3, 2024, Ninepoint High Interest Savings Fund changed its name to Ninepoint Cash Management Fund; and changed its investment strategies to follow the legal requirements for money market funds with respect to quality, liquidity and maturity of investments; and permitted the Fund to engage in securities lending as permitted by securities regulations. Effective March 4, 2019 the Ninepoint Short Term Bond Fund’s name was changed to the Ninepoint High Interest Savings Fund, and also changed its investment objective. Effective August 3, 2023 the Fund’s strategy was changed to include the option to invest in high-quality money market securities. The above is the performance for the Ninepoint Short Term Bond Fund up to March 4, 2019, the Ninepoint High Interest Savings Fund from March 8, 2019 to August 2, 2023 and that of the new strategy for the Ninepoint High Interest Savings Fund to September 2, 2024. All performance after September 3, 2024 is that of the Ninepoint Cash Management Fund.

All returns and fund details are a) based on Series F shares; b) net of fees; c) annualized if period is greater than one year; d) as at 9/30/2024. Top ten holdings and sector allocation as at 9/30/2024. Top ten holdings based on % of net asset value. Sector allocation based on % of net asset value. Numbers may not add up due to rounding. Cash and cash equivalents include non-portfolio assets and/or liabilities.

The rate of return is used only to illustrate the effects of the compound growth rate and is not intended to reflect future values of the investment fund or returns on investment in the investment fund.

The monthly distribution amount may be adjusted by the Manager without notice throughout the year as market conditions change. Monthly distributions will be comprised of net income, net realized capital gains and/or return of capital. Any net income and/or net realized capital gains earned by the Fund in excess of the monthly distribution will be distributed to unitholders annually in December.

The Fund is generally exposed to the following risks: Concentration risk; Credit risk; Cybersecurity risk; Inflation risk; Interest rate risk; Market risk; Money market fund risk; Series risk; Specific issuer risk; Substantial securityholder risk; Tax risk. Additional risks associated with an investment in ETF Series securities of this Fund include: Absence of an active market for ETF Series risk; Halted trading of ETF Series risk; Trading price of ETF Series risk.

Ninepoint Partners LP is the investment manager to a number of funds (collectively, the “Funds”). Commissions, trailing commissions, management fees, performance fees (if any), and other expenses all may be associated with investing in the Funds. Please read the prospectus carefully before investing. The indicated rates of return for series F units of the Funds for the period ended 9/30/2024 are based on the historical annual compounded total returns including changes in unit value and reinvestment of all distributions or dividends and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any securityholder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. This communication does not constitute an offer to sell or solicitation to purchase securities of the Funds.

The information contained herein does not constitute an offer or solicitation by anyone in the United States or in any other jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation. Prospective investors who are not resident in Canada should contact their financial advisor to determine whether securities of the Fund may be lawfully sold in their jurisdiction.

Ninepoint Partners LP: Toll Free: 1.866.299.9906. Dealer Services: CIBC Mellon GSSC Record Keeping Services: Toll Free: 1.877.358.0540

The opinions, estimates and projections (“information”) contained within this report are solely those of Ninepoint Partners LP (“Ninepoint”) and are subject to change without notice. Ninepoint makes every effort to ensure that the information has been derived from sources believed to be reliable and accurate. However, Ninepoint assumes no responsibility for any losses or damages, whether direct or indirect, which arise out of the use of this information. Ninepoint is not under any obligation to update or keep current the information contained herein. The information should not be regarded by recipients as a substitute for the exercise of their own judgment. Please contact your own personal advisor on your particular circumstances.

This document is for information purposes only and should not be relied upon as investment advice. We strongly recommend that you consult your investment professional for a comprehensive review of your personal ﬁnancial situation before undertaking any investment strategy. Information herein is subject to change without notice and Ninepoint is not responsible for any inaccuracies or to update this information.

Views expressed regarding a particular company, security, industry or market sector should not be considered an indication of trading intent of any investment funds managed by Ninepoint Partners LP. These views are not to be considered as investment advice nor should they be considered a recommendation to buy or sell.

The information contained herein does not constitute an offer or solicitation by anyone in the United States or in any other jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation. Prospective investors who are not resident in Canada should contact their ﬁnancial advisor to determine whether securities of the Funds may be lawfully sold in their jurisdiction.