Cash Equivalents


Cash Equivalents are fixed income investments that are short-term, liquid and marketable securities. Cash Equivalent investments are for idle cash that can be invested to earn some return. The instruments have maturities of one year or less, little credit risk and are highly marketable. Cash equivalents securities that earn interest and can be converted to cash quickly, at full market value include:

  • Certificates of Deposit;
  • Treasury Bills;
  • Auction Rate Securities;
  • Short-term Municipal Obligations;
  • Commercial Paper; and
  • Money Market Funds.

Cash Management programs are essentially a part of an overall investment strategy to invest all available assets as efficiently as possible by maintaining adequate cash and cash equivalent balances to meet liquidity needs and investment opportunities.

It is important to determine what percentage of your investment portfolio should be invested in Cash Equivalent securities based on your investment objectives, risk tolerances and investment time horizon.

Investors are advised to seek competent financial, tax and legal advice concerning the decisions they make with their investments. Klayman & Toskes, P.A. can provide you with a free consultation concerning any securities industry violations related to the handling of your investments accounts by a full-service brokerage firm or registered investment advisor.

Information contained on this webpage is for educational purposes only
and should not be considered legal advice.
No Information contained on this website creates an attorney-client relationship.