New cash management solution from Purpose enables investors to use high US interest rates to their advantage
Purpose Investments Inc. is excited to announce further expansion of its industry-leading cash solutions lineup with the launch of the Purpose USD Cash Management Fund, which begins trading on the Toronto Stock Exchange under the ticker, MNU.U.
Building off on the success of its Canadian dollar counterpart, Purpose Cash Management Fund, which launched in September 2022, the Purpose USD Cash Management Fund is designed to navigate the current economic environment and turn high interest rates into attractive yields for investors with US dollar cash allocations. At launch, the initial target annualized net yield is expected to be 5.01%.
The Fund invests in high-quality, short-term money market instruments denominated in US dollars to deliver against its primary objective of preserving capital and maintaining liquidity without taking undue risk.
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“Against the backdrop of sticky inflation, which may keep interest rates higher longer, prudent duration and robust risk and liquidity management for cash investments has become a key consideration for investors looking to earn an attractive return,” says Greg Taylor, Chief Investment Officer at Purpose.
The Purpose USD Cash Management Fund is an excellent alternative to other traditional US dollar cash alternatives for investors looking to reconsider their cash and liquidity strategies without locking them in with guaranteed investment certificates. The Fund also serves as an efficient tool for bulk trading.
“Lately, many investors are positioned defensively or have an elevated need for daily liquidity, keeping higher than usual cash balances. With record-high interest rates, investors are able to earn competitive returns on their cash investments for the first time in many years,” says Vlad Tasevski, Chief Operating Officer and Head of Product at Purpose. “The higher interest rates have made money market funds very attractive in the current market, in turn, increasing the minimum acceptable rate of return to invest in all other asset classes.”
Purpose has closed the offering of the initial units of the Fund and is pleased to offer investors US dollar-denominated ETF non-currency hedged units, Class A units and Class F units. The mutual fund units of the Fund will be offered at a fixed $10.00 net asset value.
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Key benefits of the Fund include:
- High levels of liquidity and capital preservation by investing in a diversified portfolio of short-term, high-quality, US-dollar-denominated money market instruments.
- Attractive yields are generated without taking undue credit risk to meet monthly current income requirements.
- Active management to adjust the portfolio strategy to take advantage of the changing market environment.
- Trades in US dollars and offered both as an ETF and mutual fund for ease of use, based on investor preferences.
The Purpose USD Cash Management Fund is the latest offering in Purpose’s industry-renowned cash lineup, which features the world’s first high-interest savings ETF, Purpose High Interest Savings Fund and Purpose US Cash Fund, among others. Purpose’s cash lineup is known for offering best-in-class yields significantly higher than traditional cash alternatives, deposited safely with Canada’s big banks.
Purpose revolutionized cash investing with the introduction of the Purpose High Interest Savings Fund in 2013 and is proud to expand its lineup with the Purpose USD Cash Management Fund to provide investors with a new tool to maximize returns on their US dollar cash balances.
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