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Is there any online brokerage site that offers money market rates for the cash part of a stock account if …?

October 20th, 2009 | | Tags: , , , | 4 Comments | |

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the is IRA ? Etrade does it for non-IRA only.

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4 Responses to “Is there any online brokerage site that offers money market rates for the cash part of a stock account if …?”

  1. itsjunglepat Says:
     October 20th, 2009 at 9:04 pm

    Yes, and this is one of the reasons it’s best for some people, especially those with more money, to go with a higher priced trading company. In Vanguard and Schwab, the monies not invested in stocks etc, must manually be invested in a money market fund to get money market rates. With Fidelity, it becomes more of a sweep feature, meaning to say automatic. Note however, that a money market fund is not the same as a bank money market account. Bank money market accounts are FIDC insured while money market funds are not. As of late, due to financial instability, the government has also offered insurance on the money market funds which most bigger companies like the 3 above are using. However, funds are insured only for those who got in before some time in September. Money market funds are more risky than usual at this time, and aren’t paying highly at this point either. (11/01/08)

  2. JohnGalt Says:
     October 20th, 2009 at 9:04 pm

    Most all of them do this. It is odd to me that etrade does not for IRAs. How competitive the rates are can vary, but they all have some version of this. I guess this is another reason why you have to shop for more than just the lowest commissions.

  3. Michael T Says:
     October 20th, 2009 at 9:04 pm

    Check again with E-Trade. Most brokerages offer both FDIC insured (bank) money market accounts which offer a low or no interest rate or non FDIC insured (money market mutual funds) money market accounts that offer a reasonable interest rate for both normal and IRA accounts.

    Usually when a brokerage offers a high interest rate money market account as the sweep account, the account is a mutual fund money market account and is not FDIC insured.

  4. b2fnow Says:
     October 20th, 2009 at 9:04 pm

    Even for the stock acct, you can invest in a T-bill and use that as trading equity. Given, it isn’t much, and there was even one day during the sell-off that the T-bill interest rates went slightly negative, where you had to pay the fed to hold your money!

    I think the minimum T-bill is $10,000.

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