Cash Manager

The Ted & Alice Henderson portfolio is used to illustrate various cash management features.  Highlighted areas are all related to cash management. The amount to deposit or withdraw and the cash reserve in the Individual Account Information are optional entries. Blanks are treated as zero.

TedAlice

The accounts include a special ticker named *cash whose asset class is Cash, both highlighted. In typical use, *cash will correspond to a money market account. The price is automatically set to 1.0 and the basis equals the value (hence, capital gain is zero). The asset class Cash has a target of zero in this example, but its reasonable to have positive value. Caution -- don't forget the asterisk in *cash because the ticker CASH is the symbol for a company listed on the NASDAQ.

Now make a deposit into Ted's IRA, $2,000 for example. Enter 2,000 into the deposit field and press rebalance to get this result. (Actually, the Individual Account Information dialog will disappear when pressing rebalance.  Its retained here to show the initial deposit entry.)

TedAliceDeposit

Observe several results.

  • The Cash Flow window indicates the deposit amount for the portfolio, which would be more than 2,000 if there were deposits into other accounts
  • The total in the Trade column of 2,000 matches the deposit, for Ted's account
  • There is a negative tax (-500) because the deposit is to an IRA with a portfolio income tax rate of 25% (capital gains in the Ted & Alice account were all zero, so the IRA deposit is the only taxable event)
  • The down pointing arrow on the Ted IRA button indicates a deposit into the account, and would point upward for a withdrawal.

Use deposit and withdraw entries to coordinate rebalancing while moving money into or from individual accounts.


Cash Reserve provides a way to exclude a specific cash amount from an individual account during rebalancing. This is different from choosing a value (greater than zero) for the Cash asset class, since that applies to the entire portfolio. Think of the reserve as a hiding place, off to the side during rebalancing. As an example, choose a $3,000 cash reserve in the Ted & Alice account.

CashReserve

Observe these results.

  • The total trade column of -3,000  is highlighted in yellow as a cash reserve reminder
  • The Ted & Alice selector button also has a circular arrow icon as a reserve alert
  • The black disk "hanging from the ceiling" below the rebalance button represents the portfolio cash reserve amount
  • The cash reserve row in the target table displays portfolio reserve percentages

A side-by-side view of the target table with both percent and dollar amounts appears below.  Recall that clicking on the header bar switches between Percent and $$$.

CashReserveSideBySide

Observe the following:

  • The target and plan reserve of $3,000 corresponds to 3.7% of the portfolio total
  • The actual reserve of $200 is the starting cash in Ted & Alice account
  • The total portfolio value is 78,050 + 3,000 = 80,850 + 200 = 81,050

Tips & Tricks

Deposits, withdrawals and cash reserves are assigned independently for each account. Totals for the portfolio are displayed to give an at-a-glance view of the overall cash management settings.  Use of a *cash ticker and Cash asset class is preferred to enable the cash management capability.  Other ticker symbols can be used with the Cash asset class, but they will not have price and basis automatically set.

Cash reserve can be larger than available cash in the account. This will trigger selling other assets to generate the reserve.

The price for *cash is automatically set assuming that a money market account will have net asset value of 1.0.  A different value can be entered in the unlikely event that NAV is different.  Override of basis is also allowed.