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Cash Management

Overview

Cash is usually the least volatile type of investment. Cash tends to be included in a portfolio to meet liquidity needs and for its defensive characteristics.

Cash investments include cash accounts, high-interest savings accounts and term deposits. In these accounts interest is calculated on the daily closing balance of the account and paid monthly (in the case of cash and high-interest savings accounts) and monthly, quarterly, semi-annually, annually or at the end of the term in the case of term deposits. The interest can also be reinvested in the account to compound returns.

However, cash investments generally aren’t suitable for long-term investment goals because the returns are likely to be low and may not meet your long-term financial goals, such as a comfortable retirement.

The Australian Government guarantees cash deposits of up to $250,000 in Authorised Deposit-taking Institutions (ADIs) such as banks, credit unions and building societies. This means up to $250,000 of your money is guaranteed if anything happens to your ADI.

NAB is an ADI and as such retail cash deposits up to $250,000 are guaranteed by the Australian Government.

Features

Integrated Cash Settlement & High Interest Accounts

Investors need to settle investment purchases and have the ability to hold cash in a safe, accessible, high interest account.  nabtrade provides both, in one seamless integrate online solution. 

Cash Account

Every nabtrade account comes with a fully integrated settlement cash account used to settle your domestic and international trades. It has unlimited online transactions, no ongoing account fees or minimum balance requirements.  

You can fund this account through instant transfers from your linked NAB accounts or by using fund transfers/BPAY payments from other external bank accounts.

Cash Account interest rates

High Interest Account

Open a nabtrade High Interest Account today to receive our competitive variable interest rate of 2.15% p.a.^

With nabtrade’s High Interest Account you’ll enjoy a competitive interest rate, no ongoing account fees or minimum balance requirements. 

Adding a High Interest Account can be done with a few clicks, completely online. Simply log into your nabtrade account and go to Admin > Permissions, then click on the Apply link next to High Interest Account.

With a nabtrade High Interest Account you'll enjoy:

  • Instant transfers to your Cash Account
  • Unlimited movements in and out of the High Interest Account
  • No minimum balance requirements
  • No ongoing account fees
  • Total Wealth and cash reporting

^ Rates are variable and apply to balances up to $1,000,000. On higher balances lower interest rates apply.

High Interest Account

Balance ANZ CBA Westpac
$0 to $1,000,000 2.15% p.a. 1.15% p.a. 1.05% p.a. 1.00% p.a.
$1,000,000 + 1.50% p.a. 1.15% p.a. 1.05% p.a. 1.00% p.a.

SOURCE: CANSTAR. Competitor rates and fees are updated on a daily basis. Products shown are considered comparable products by nabtrade, however product features may differ. This table does not include any discounts, fees and charges, or promotional interest rates (other than those stated). Products compared are: ANZ Online Saver, Commonwealth Bank NetBank Saver, nabtrade High Interest Account, Westpac eSaver.

The nabtrade Cash Products are issued by National Australia Bank Limited ABN 12 004 044 937 AFSL 230686 (NAB) and are to be used in conjunction with the nabtrade service. WealthHub Securities is not an Authorised Deposit Taking Institution and its obligations do not represent deposits or other liabilities of NAB.

Benefits

  1. Liquidity - 'at call' cash deposits are the ultimate liquid asset.  That is, liquidity is a measure of how easily and quickly an asset can be converted to cash.  Cash is already cash! 
  2. Very low capital risk - cash as an asset poses no capital risk beyond inflation risk (defined in the Risks section below).  
  3. Guaranteed – in Australia retail client cash deposits of up to $250,000 in Authorised Deposit-taking Institutions (ADIs) such as banks like nab, are guaranteed by the Australian Government.
  4. Emotional comfort - holding cash, particularly in times of falling property, stock or other markets, can give the investor a greater peace of mind.  
  5. Optionally of cash - the famous investor, Warren Buffet, has said of cash "... think of cash as a call option with no expiration date, an option on every asset class, with no strike price.”

Risks

  1. Inflation risk - any economy that has inflation means that cash, over time, loses its purchasing power.  This effectively means that a dollar in the future is worth less than a dollar today.
  2. Low returns - holding a portfolio of only cash is usually not a viable option for long term wealth generation.

 

Important Information: The nabtrade Cash Products are issued by National Australia Bank Limited ABN 12 004 044 937 AFSL 230686 (NAB) and are to be used in conjunction with the nabtrade service. The nabtrade High Interest Account variable interest rate applies to the whole balance of your Account and is subject to change at any time. WealthHub Securities is not an Authorised Deposit Taking Institution and its obligations do not represent deposits or other liabilities of NAB.