Corporate Cash Management (CCM)

The experienced investor knows that navigating the universal investment sphere is not enough and is challenging in today’s volatile markets. Today’s retail investors often overlook or forget corporate cash management accounts and facilities, but they hold immense value if used correctly.  

What is Corporate Cash Management?

Investors often manage their long-term investment securities with diligence and care. Corporate cash management refers to the process of administering your cash holdings in the same way. Cash management is the process of managing your cash flow to ensure that your money contributes to the success of your overall investment portfolio. This process allows you to meet your savings and FX needs better.

Importance of Cash Management

Managing cash is an integral part of a successful investment portfolio. This asset class provides protection to a portfolio due to its riskless nature. However, holding too much cash in a portfolio can prevent the returns from suffering from cash drag. The low-interest rates that cash earns in a regular trading or investment account often drag the return on the portfolio by failing to keep up with inflation. Consequently, cash acts as a source of liquidity in a portfolio allowing an investor to pounce on attractive buying opportunities. With both pros and cons to holding cash as an asset class, it is crucial for investors to manage their cash flows and ensure that it adds value to the portfolio. The corporate cash management account offered by Trive South Africa poses a solution to make the management of your cash holdings easier.

Functions of a Corporate Cash Management Account

A corporate cash management account gives you the necessary flexibility and access at competitive rates to ensure your money is being used effectively. This account will ease the process of managing your cash, securely moving money abroad to offshore investments, and engaging in foreign exchange. At Trive South Africa, spot and forward exchange contracts will be provided with efficient pricing. The competitive rates this account will offer will enable you to maximise the returns on your investment. Furthermore, this account provides overnight liquidity and access to your funds, allowing you to manage your cash flows more efficiently. The offerings at Trive South Africa include a personalised service dedicated to you with attractive interest rates on money market products.

Additionally, a notable amount of savings can be received on foreign exchange rates and total transaction fees. The only transactional charges that will be incurred are those related to non-standard transactions and cash deposits. The offering will give you access to call accounts, which will provide you with immediate access to your funds or funds that are available on call in the form of a CCM Call Money Fund. These call accounts will earn competitive rates in the form of a prime-linked call rate. These rates can generally be earned on terms ranging from 15 to 120 days. Those interested in foreign exchange can feel comfortable with competitive interbank rates and know that professionals are also working to secure competitive foreign exchange rates.

Benefits of a Corporate Cash Management Account to an Invest 

The profitable investor will know that utilising the different parts of their portfolio is key to ensuring long-term success. A corporate cash management account’s benefit to an investor is the additional ability to use a cash holding to navigate the volatility of the markets effectively. During periods of market stress, investors want to avoid the volatility of the markets and opt for the safe route of holding cash. Holding cash enables investors to limit their losses during market downturns, but their upturn potential is also limited. In these situations, rather than imposing a massive cash drag on a portfolio by leaving cash in a standard trading account with minimal interest rates and bearing the brunt of additional fees, an investor can deposit that money into a corporate cash management account. This allows them to enjoy the benefits of healthy interest rates, minimal fees, and the necessary liquidity required to swiftly enter the market when conditions are favourable again and avoid missing out on the upswings.

Disclaimer: Trive South Africa (Pty) Ltd, Registration number 2005/011130/07, and an Authorised Financial Services Provider in terms of the Financial Advisory and Intermediary Services Act 2002 (FSP No. 27231). Any analysis/data/opinion contained herein are for informational purposes only and should not be considered advice or a recommendation to invest in any security. The content herein was created using proprietary strategies based on parameters that may include price, time, economic events, liquidity, risk, and macro and cyclical analysis. Securities involve a degree of risk and are volatile instruments. Market and economic conditions are subject to sudden change which may have a material impact on the outcome of financial instruments and may not be suitable for all investors. When trading or investing in securities or alternative products, the value of the product can increase or decrease meaning your investment can increase or decrease in value. Past performance is not an indication of future performance. Trive South Africa (Pty) Ltd, and its employees assume no liability for any loss or damage (direct, indirect, consequential, or inconsequential) that may be suffered from using or relying on the information contained herein.  Please consider the risks involved before you trade or invest.