Where to find decent interest on cash in Europe?
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Where to find decent interest on cash in Europe?
Hi all,
I'm looking to earn some interest on my rainy day fund (~€40k, but currently still in USD).
I'm a bit lost on how to go about finding this, so if someone could point me in the right direction that'd be tremendously helpful.
I'm using IBKR as my broker.
The best I've found so far is 4% on Kraken (which obv doesn't have deposit insurance, but is arguably the most secure of all crypto exchanges).
Look forward to your insights and suggestions
I'm looking to earn some interest on my rainy day fund (~€40k, but currently still in USD).
I'm a bit lost on how to go about finding this, so if someone could point me in the right direction that'd be tremendously helpful.
I'm using IBKR as my broker.
The best I've found so far is 4% on Kraken (which obv doesn't have deposit insurance, but is arguably the most secure of all crypto exchanges).
Look forward to your insights and suggestions
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- Joined: Fri May 11, 2007 11:07 am
Re: Where to find decent interest on cash in Europe?
We are not allowed to discuss cry** here. I'd back a way a mile. Nothing in that ecosystem looks remotely "safe" to me.TommyCapital wrote: ↑Fri Feb 17, 2023 6:45 am Hi all,
I'm looking to earn some interest on my rainy day fund (~€40k, but currently still in USD).
I'm a bit lost on how to go about finding this, so if someone could point me in the right direction that'd be tremendously helpful.
I'm using IBKR as my broker.
The best I've found so far is 4% on Kraken (which obv doesn't have deposit insurance, but is arguably the most secure of all cry** exchanges).
Look forward to your insights and suggestions
Money Market Fund. Or Short Term Bond Fund. Or bank deposits.
Re: Where to find decent interest on cash in Europe?
Europe is a continent not a country
Where are you based?
Where are you based?
- Bernmaster
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Re: Where to find decent interest on cash in Europe?
European banks have been slow to increase yields on bank deposits. Personally, I would not feel comfortable with my rainy day fund invested in the alternative you mentioned in the opening post.
A money market or short-term bond fund as mentioned by Valuethinker appears to be a very sensible solution. These are € denominated MMFs - all of them should do the trick.
https://www.justetf.com/en/find-etf.htm ... rrency=EUR
A money market or short-term bond fund as mentioned by Valuethinker appears to be a very sensible solution. These are € denominated MMFs - all of them should do the trick.
https://www.justetf.com/en/find-etf.htm ... rrency=EUR
"The unsophisticated investor who is realistic about his shortcomings is likely to obtain better results than the knowledgeable professional who is blind to even a single weakness” ― Warren Buffett
Re: Where to find decent interest on cash in Europe?
Italy’s BancoPosta offers a 3,0% 270-day term deposit.
Re: Where to find decent interest on cash in Europe?
Your savings are in USD. Doesn’t IBKR offer US Treasuries on the secondary market? Safest investment possible with decent interest rates and not taxed (by US if you’re not a US resident)
You will have to face exchange rate risk through, depending on the currency you expect your liabilities to be in.
But as others have mentioned, I would not keep my rainy days assets in anything other than strictly regulated institutions.
You will have to face exchange rate risk through, depending on the currency you expect your liabilities to be in.
But as others have mentioned, I would not keep my rainy days assets in anything other than strictly regulated institutions.
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Re: Where to find decent interest on cash in Europe?
Ah great, I wasn't sure about the tax status. Thanks for the suggestion.
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Re: Where to find decent interest on cash in Europe?
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Re: Where to find decent interest on cash in Europe?
Okay gotcha, won't mention the c-word again!Valuethinker wrote: ↑Fri Feb 17, 2023 7:11 amWe are not allowed to discuss cry** here. I'd back a way a mile. Nothing in that ecosystem looks remotely "safe" to me.TommyCapital wrote: ↑Fri Feb 17, 2023 6:45 am Hi all,
I'm looking to earn some interest on my rainy day fund (~€40k, but currently still in USD).
I'm a bit lost on how to go about finding this, so if someone could point me in the right direction that'd be tremendously helpful.
I'm using IBKR as my broker.
The best I've found so far is 4% on Kraken (which obv doesn't have deposit insurance, but is arguably the most secure of all cry** exchanges).
Look forward to your insights and suggestions
Money Market Fund. Or Short Term Bond Fund. Or bank deposits.
Re: Where to find decent interest on cash in Europe?
Hi,
the following section gives overall information on cash equivalents in the EU area for non US investors:
https://www.bogleheads.org/wiki/Cash_eq ... _investors
For individual rates you will need to research each bank or fund individually.
DJN
the following section gives overall information on cash equivalents in the EU area for non US investors:
https://www.bogleheads.org/wiki/Cash_eq ... _investors
For individual rates you will need to research each bank or fund individually.
DJN
Yah shure. |
Have a look at the Bogleheads Wiki in the first instance.
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Re: Where to find decent interest on cash in Europe?
Thank you, this is precisely what I was looking for!DJN wrote: ↑Fri Feb 17, 2023 11:35 am Hi,
the following section gives overall information on cash equivalents in the EU area for non US investors:
https://www.bogleheads.org/wiki/Cash_eq ... _investors
For individual rates you will need to research each bank or fund individually.
DJN
Re: Where to find decent interest on cash in Europe?
I am curious if US Treasuries are available at IBKR and if they are lower cost than other MMFs mentioned above. They are not always the most profitable, but these days they seem to be in US at leastTommyCapital wrote: ↑Fri Feb 17, 2023 1:21 pmThank you, this is precisely what I was looking for!DJN wrote: ↑Fri Feb 17, 2023 11:35 am Hi,
the following section gives overall information on cash equivalents in the EU area for non US investors:
https://www.bogleheads.org/wiki/Cash_eq ... _investors
For individual rates you will need to research each bank or fund individually.
DJN
Re: Where to find decent interest on cash in Europe?
Anyone successfully buy Treasuries at IBKR?
I saw some 4.9% annualized on the 6 month the other day.
Do they have 6-7 figure minimum trading sizes because I even tried to hit the ask on a few with $10k and I never got fills.
At Schwab Int'l it's super easy and get instant fills even at the bid or mid price.
I saw some 4.9% annualized on the 6 month the other day.
Do they have 6-7 figure minimum trading sizes because I even tried to hit the ask on a few with $10k and I never got fills.
At Schwab Int'l it's super easy and get instant fills even at the bid or mid price.
Re: Where to find decent interest on cash in Europe?
How would you put the information from the link to use?TommyCapital wrote: ↑Fri Feb 17, 2023 1:21 pmThank you, this is precisely what I was looking for!DJN wrote: ↑Fri Feb 17, 2023 11:35 am Hi,
the following section gives overall information on cash equivalents in the EU area for non US investors:
https://www.bogleheads.org/wiki/Cash_eq ... _investors
For individual rates you will need to research each bank or fund individually.
DJN
How would you compare variouos alternatives listed, and what would you end up picking (buying) at the moment?
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Re: Where to find decent interest on cash in Europe?
I would look at 3 things:TitanT2 wrote: ↑Sun Feb 19, 2023 3:31 amHow would you put the information from the link to use?TommyCapital wrote: ↑Fri Feb 17, 2023 1:21 pmThank you, this is precisely what I was looking for!DJN wrote: ↑Fri Feb 17, 2023 11:35 am Hi,
the following section gives overall information on cash equivalents in the EU area for non US investors:
https://www.bogleheads.org/wiki/Cash_eq ... _investors
For individual rates you will need to research each bank or fund individually.
DJN
How would you compare variouos alternatives listed, and what would you end up picking (buying) at the moment?
- net interest rate (after tax)
- deposit insurance protection (and which national government backstops it (& what their credit rating is))
- credit rating of the financial institution
Re: Where to find decent interest on cash in Europe?
You already earn interest on your USD cash balance at ibkr. How much depends on the total NAV of your account (including non-cash investments): https://www.interactivebrokers.com/en/a ... -rates.php
You could improve that by purchasing a usd money market mutual fund such as Invesco USD liquidity portfolio (but the min purchase is usd 150,000) or a usd ultra-short bond fund or etf.
To be noted however that at some point, the US will pause its rate increases while the EU will continue theirs. At that point, Euros will become more expensive to buy with your dollars. So at the point you think the US will stop rising its rates might be a good time to exchange your dollars for Euros.
You could improve that by purchasing a usd money market mutual fund such as Invesco USD liquidity portfolio (but the min purchase is usd 150,000) or a usd ultra-short bond fund or etf.
To be noted however that at some point, the US will pause its rate increases while the EU will continue theirs. At that point, Euros will become more expensive to buy with your dollars. So at the point you think the US will stop rising its rates might be a good time to exchange your dollars for Euros.
Re: Where to find decent interest on cash in Europe?
Pimco MINT LN.
Re: Where to find decent interest on cash in Europe?
This is a US-domiciled ETF. For most non-resident aliens, it is a bad idea to purchase US situs assets as there are tax traps (withholding tax and estate tax). There are exceptions for residents of countries that have favorable tax treaties with the US, but they are few and far between. See these links:
Nonresident alien investors and Ireland domiciled ETFs
Non-US investor's guide to navigating US tax traps