Uncertainties over the Trump presidency and weaker-than-expected US economic data have caused quite a stir in recent weeks, with 2025 proving to be a volatile start for equity and fixed income markets. Amidst market gyrations, cash management solutions have proven to be a safe harbour for investors as the current yield backdrop remains attractive today and is expected to remain so with the Fed pushing back rate cuts. Meanwhile, duration risks for cash management solutions are less than those in the broader fixed income market, providing additional stability in this uncertain era.
Today, investors have a wide range of choices to manage their cash depending on their investment objectives and horizons. Whether you’re looking for a low-risk investment product, or a temporary cash parking facility before re-deploying in other stocks / bonds (or other products), don’t miss out on the cash-management solutions that can help you earn that extra yield!
Our framework for cash management
Our framework assesses multiple factors, including (i) funds’ return profiles (e.g. historical performance and latest indicative yields), (ii) risk profiles (e.g. duration and credit risks, and historical volatility metrics), and (iii) liquidity in terms of settlement schedules.
The funds below are arranged in order, starting from the most liquid option (T+0). T+0 means that if you submit a redemption order by 10am, you can expect to receive your monies on the same day, hence the “0” [representing a zero-day delay].
(Analysis is as of 27 February 2025 or as of the latest data available [e.g. End-January factsheet]).
1. AutoSweep (T+0)
This is our in-house liquidity solution comprising 90% iFAST Enhanced Liquidity Fund + 10% Cash. AutoSweep monies can also be directly used to purchase investments on iFAST platforms, all with no delays.
2. iFAST Enhanced Liquidity Fund (T+0)
Our Enhanced Liquidity Funds (ELFs) aim to preserve capital and provide investors with a high level of liquidity while enhancing yields. These ELFs are well-diversified across issuers / counterparties and across product types, including money market funds, deposits, and bonds.
The availability of T+0 settlement underscores the ELFs’ emphasis on liquidity for end investors. Compared to the AutoSweep, our ELFs will generally offer higher yields (since AutoSweep has a lower-yielding Cash component [10%]), though it cannot be directly used for purchasing investments (i.e. investors will have to sell units in the ELF to get cash before purchasing other investments).
3. Other funds (T+1 to T+4)
Investors can alternatively choose from the multiple money market and short-duration bond funds on our platform to fit their cash management objectives (e.g. based on risk tolerance and yield targets). The underlying funds chosen for a cash management portfolio must generally be low-risk in nature with lower expected drawdowns.
SGD: Our top picks for cash management
We summarise some of our top picks in Table 1. We also provide sample model portfolios in Table 2.
LionGlobal SGD Money Market Fund and LionGlobal SGD Enhanced Liquidity Fund are among our top picks for your cash management needs. Both funds primarily invest in a mix of Singapore government securities and corporate bonds from other markets (primarily in Asia). They have weighted credit ratings of A+ each, with low weighted durations of under 0.4 years. Their historical volatility and drawdown metrics are also comparable (e.g. both have 3-year drawdowns of less than 0.1%), helped by their cost-amortised nature. For investors who wish to pick just one fund instead of two, we prefer the LionGlobal SGD Money Market Fund due to its very slight edge in terms of net yield.
Fullerton SGD Cash Fund is also a decent consideration. Its 3y performance track record is particularly decent, even when compared to the two LionGlobal funds above. However, since it adjusted its mandate and increased its management fee in February 2024, we noticed its more recent performance, and its latest indicative net yields have started to marginally lag behind its LionGlobal peers.
Nikko AM Shenton Short Term Bond Fund and United SGD Fund are short-duration bond funds which we like. These are slightly higher-risk options than the three funds above, given their higher duration (> 1 year) and lower credit quality (Nikko: A- / United: BBB+). For cash management, investors should also note that these funds tend to have higher NAV volatility and drawdowns as compared to money-market or liquidity funds. Nonetheless, we think these funds provide decent indicative net yields and are great choices for investors looking to enhance their portfolio yield.
Lastly, we highlight our in-house iFAST SGD Enhanced Liquidity Fund - Now available on our main iFAST platforms! This is a good option for investors seeking an unparalleled liquidity of T+0. While it has not had a long track record, the fund has zero days of negative returns thus far and low volatility levels compared to peers. We think this fund offers a solid combination of low risk and decent returns for investors who prioritise liquidity in a temporary cash-parking facility.
Table 1: Main funds under consideration - SGD
| LionGlobal SGD Money Market A SGD | LionGlobal New Wealth Series - LionGlobal SGD Enhanced Liquidity A Acc SGD | Fullerton SGD Cash Fund A SGD | Nikko AM Shenton Short Term Bond SGD | United SGD Fund Cl A Acc SGD | iFAST SGD Enhanced Liquidity Fund*** | |
| 3y Annualised Return (%) | 2.94% | 2.62% | 3.20% | 2.99% | 2.56% | - |
| Indicative Net Yield (%)* | 3.24% | 3.18% | 2.81% | 4.13% | 3.49% | 2.96% |
| Duration (years)** | 0.29 | 0.35 | 0.15 | 1.15 | 1.61 | 0.25 |
| 3y Annualised Vol (%) | 0.16% | 0.16% | 0.26% | 0.85% | 1.02% | 0.12% |
| 3y Annualised Downside Vol (%) | 0.01% | 0.03% | 0.12% | 0.40% | 0.52% | 0.00% |
| 3y Max DD (%) | -0.01% | -0.07% | -0.25% | -2.01% | -3.14% | 0.00% |
| Average Credit Rating | A+ | A+ | - | A- | BBB+ | AA- |
| Settlement Schedule (T + x working days) | T+1 | T+1 | T+1 | T+2 | T+4 | T+0 |
| *Net yield calculated based on either gross yield - TER or 7d
net performance depending on data availability. Nikko AM yields are in
local-currency terms. **If duration data is unavailable for certain funds, we may take their WAM as their duration. ***Insufficient data as fund has not yet been incepted for 3 years. |
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Table 2: Model cash management portfolios – SGD
| SGD Conservative | SGD Moderate | SGD Aggressive | |
| Constituents | |||
| 3y Annualised Return (%) | 3.00% | 2.87% | 2.77% |
| Indicative Net Yield (%)* | 3.13% | 3.45% | 3.51% |
| Duration (years)** | 0.26 | 0.52 | 0.85 |
| 3y Annualised Vol (%) | 0.18% | 0.33% | 0.54% |
| 3y Annualised Downside Vol (%) | 0.04% | 0.11% | 0.24% |
| 3y Max DD (%) | -0.07% | -0.53% | -1.31% |
| *Net yield calculated based on either gross yield
- TER or 7d net performance depending on data availability. **If duration data is unavailable for certain funds, we may take their WAM as their duration. ***Fullerton fund chosen here primarily for fundhouse diversification. |
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USD: Our top picks for cash management
We summarise some of our top picks in Table 3. We also provide sample model portfolios in Table 4.
BNP Paribas USD Money Market Fund and Amundi Funds Cash USD are among our top picks within the USD space. Both funds have delivered solid 3-year returns (around 4.2% p.a.), and their latest reported indicative net yields are also very similar (around 4%). Both funds are high in credit quality (averaging A) with a history of minimal drawdowns in the past 3 years (BNP: 0.00% drawdown). We think these funds are both best-in-class for USD Money Market funds.
HGIF – Ultra Short Duration Bond Fund is our top short-duration bond fund pick, used primarily for yield enhancement. This fund typically has its portfolio duration ranging from 0.3 years to 0.5 years, helped by its majority (>50%) allocation into floating-rate bonds. It also maintains a high-quality tilt with its minimum average credit rating of A-, and all bonds must be investment-grade rated at the time of purchase. The fund has shown its ability to outperform traditional money market funds over the past 3 years despite slightly higher drawdowns (3y drawdown of -0.6%). We think this HSBC fund is one of the best choices for those looking for higher returns and are willing to take on slightly more risks compared to a traditional money market fund.
Finally, our in-house iFAST USD Enhanced Liquidity Fund - similar to its SGD counterpart – is now available on our main iFAST platforms! This fund continues to be the premier option for its T+0 settlement schedule, underscoring the ‘liquidity’ in its fund name. Like its SGD counterpart, it has a history of zero days of negative returns thus far. We think this fund offers a solid combination of low risk and decent returns for investors who prioritise liquidity in a temporary cash-parking facility.
Table 3: Main funds under consideration – USD
| BNP Paribas USD Money Market Classic Cap USD | Amundi Funds Cash USD A2 (C) USD | HGIF - Ultra Short Duration Bond PM2 USD | Nikko AM Shenton Short Term Bond USD-H | iFAST USD Enhanced Liquidity Fund | |
| 3y Annualised Return (%) | 4.23% | 4.25% | 4.69% | 4.03% | - |
| Indicative Net Yield (%)* | 3.96% | 4.22% | 4.41% | 4.13% | 4.30% |
| Duration (years)** | 0.07 | 0.19 | 0.46 | 1.15 | 0.19 |
| 3y Annualised Vol (%) | 0.21% | 0.22% | 0.83% | 0.86% | 0.19% |
| 3y Annualised Downside Vol (%) | 0.00% | 0.03% | 0.36% | 0.40% | 0.00% |
| 3y Max DD (%) | 0.00% | -0.06% | -0.56% | -2.02% | 0.00% |
| Average Credit Rating | A | A | A | A- | AA |
| Settlement Schedule (T + x working days) | T+4 | T+4 | T+4 | T+4 | T+0 |
| *Net yield calculated based on either gross yield
- TER or 7d net performance depending on data availability. Nikko AM yields
are in local-currency terms. **If duration data is unavailable for certain funds, we may take their WAM as their duration. ***Insufficient data as fund has not yet been incepted for 3 years. |
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Table 4: Model cash management portfolios - USD
| USD Conservative | USD Moderate | USD Aggressive | |
| Constituents | |||
| 3y Annualised Return (%) | 4.23% | 4.35% | 4.30% |
| Indicative Net Yield (%)* | 4.02% | 4.14% | 4.18% |
| Duration (years)** | 0.10 | 0.20 | 0.47 |
| 3y Annualised Vol (%) | 0.21% | 0.37% | 0.53% |
| 3y Annualised Downside Vol (%) | 0.01% | 0.10% | 0.20% |
| 3y Max DD (%) | -0.02% | -0.16% | -0.66% |
| *Net yield calculated based on either gross yield
- TER or 7d net performance depending on data availability. **If duration data is unavailable for certain funds, we may take their WAM as their duration. |
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How our solutions fare against other cash competitors
There are many products out there that may already be part of how you manage your cash today. For instance, many of our local investors may already have put some money into the fortnightly 6-month Singapore Treasury Bill auctions, which had its last cut-off yield at 2.75%. In parallel, USD-based investors may have put their money into 6m US Treasuries, yielding around 4.3% at the time of writing (note: both figures are gross yields before relevant fees). While these T-Bills continue to offer attractive yields, we emphasise that these are not as liquid as the funds listed above – investors may find it difficult or expensive to liquidate them before maturity.
Fixed deposits (with banks) are popular alternatives among our investors, too. However, based on a quick look at fixed deposit rates across our local banks, they generally yield around mid-2% for SGD deposits and mid-3% for USD deposits. Coupled with the lock-in period for these deposits, we think that the cash management options mentioned above provide competitive (higher) yields while being much more liquid compared to fixed deposits.
(Note: Investors usually are technically able to liquidate their fixed deposits early before maturity if they wish, but this may lead to the forfeiture of interest or potentially incur other early-cancellation charges.)
Finally, various investment platforms (including iFAST) provide their customised cash solutions that usually use a fixed allocation to money market funds and short-duration bond funds, including some names listed above. Two important benefits of our iFAST Auto-Sweep, and by extension our iFAST Enhanced Liquidity Funds (SGD and USD), are that they will (i) dynamically adjust the allocations to different funds depending on their return and risk profiles; and (ii) will have the flexibility to invest in other instruments like bonds and fixed deposits, to earn greater risk-adjusted yields.
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