3Mes·

Optimal cash parking - dangers with Trade Republic?

I have a large part of my cash reserve at Trade Republic, as it offers the ECB key interest rate of 2.75% on "unlimited" amounts of capital.

I am aware that there is statutory deposit protection for cash assets up to €100,000.

But now I've stumbled across the attached article, which explains, among other things, how Trade Republic can pass on the return on the key interest rate:

Part of the cash is invested in a money market fund and is therefore not subject to deposit protection.

In the Traderepublic app, under Cash -> Average Balance -> "How we hold your cash", you can see the distribution between the normal account and the money market fund.

In my case, 95% of my holdings are in the BlackRock ICS Euro Liquidity Fund.

As this is a AAA-rated fund with a size of 91 billion euros, I'm not too worried about the security aspect.

However, most of my money is in the fund, which in itself yields about 1% more than Trade Republic pays.

Everyone has to decide for themselves whether it makes sense to pay this price for maximum flexibility.

However, I was considering investing my cash in a money market fund like the $W0S04F and/or $CSH (+0,01%) and will do so next week.

How do you assess the "risk" or the procedure at Traderepublic and what else do you do with uninvested cash reserves?

https://www.futurezone.de/digital-life/verbraucher/article621271/gegen-trade-republic-verbraucherzentrale-zieht-vor-gericht-koennten.html

www.futurezone.deTrade Republic-Anleger könnten "Teil ihres Vermögens verlieren" – Experten ziehen Konsequenzen

13 Commenti

Joker@Blizzard

3Mes

You have to decide for yourself whether the 1% is worth the comfort. Also remember that other banks give little or nothing. The main aim is for the money to grow and not fall victim to inflation. Why not an Etf like Msci World etc?

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Mo@BigMo

3Mes

@Blizzard Exactly. As I said, everyone has to decide for themselves.
I will leave a portion directly with TR and put the rest in a money market fund.
The direct cash holdings also feed savings plans, for example.

The situation is different for everyone, but in general the point of a cash quota (currently 15% for me) is that I don't want to invest it completely straight away.
Especially in the current market phase.

In return, I also accept a potential lower return over the next few years if the markets continue to run non-stop (which is becoming increasingly unlikely).

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RHPG@Rentner

3Mes

This is what TR says:
Money market funds: Shares in money market funds are held in a separate custody account. These assets are strictly protected and held separately from Trade Republic's own assets. They are protected without limitation.

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Finanzaristokrat@Finanzaristokrat

3Mes

I don't understand the panic about investing in a money market fund. Anyone who is well informed knows that there is hardly any risk involved. If TR goes bust, your cash is protected up to 100,000k. Like ETFs and shares, the money in the money market fund belongs to YOU. In the event of a bankruptcy, it will be transferred 1:1 to your new bank. Only cash over 100,000 in the call money account would be affected.

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Mo@BigMo

3Mes

@Finanzaristokrat I agree. Here, the press is once again spinning its wheels unnecessarily.

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Vincent@VincP3

3Mes

Where do you see the breakdown? My full clearing account is with Deutsche Bank

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Mo@BigMo

3Mes

@VincP3 I have described above (my app is in English)

In the Traderepublic App you can see under Cash -> Average Balance -> "How we hold your cash", how the distribution between normal account and money market fund is.

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Vincent@VincP3

3Mes

@BigMo ok, then I am exclusively with Deutsche Bank

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Maverick4831@Maverick4831

3Mes

@VincP3 It changes every month. In the beginning, I only used Deutsche Bank, but now it's 50/50.

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Sparfuchs@Reinecke

3Mes

I also have it with Deutsche Bank. As far as I know, >30k is only invested elsewhere.

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Malte@Rexvetis

2Mes

@VincP3 The amount is crucial. Smaller amounts are not actually invested in funds

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MR-sambal5@MR-sambal5

3Mes

Mine is completely invested in to the Deutsche bank

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Stevoo@Stevoo13

2Mes

Hey man, interesting topic as I also have over 100k deposited at TR and also have most of it in Blackrock after I checked...I also checked the interest rate of the fund and it's also around 2.75% btw (you need to check the returns to-date for 2025 and extrapolate for a year and it comes to 2.75%). Honestly I was debating buying some bonds with the extra cash but couldn't find something with limited risk but with high enough returns so I decided to keep in TR for now.

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