When Storms Hit, Seek Safety With Government Backed Securities

When storms hit, seek safety with government backed securities
Markets
Ben Verschuere - Chief Investment Officer
|
March 9, 2023

A Special Letter from Treasure CIO, Ben Verschuere

Dear Treasure Investors: 

We are in the midst of stormy waters in the capital markets. With the shutdown and liquidation of crypto-focused banks and turmoil at technology-focused banks, fear is spreading among mid-market businesses whose default cash management strategy is to hold cash at a business bank.

The Treasure Investment and Compliance team have been here before. I was part of Peter Thiel’s hedge fund in 2008 where we gained first hand experience navigating very turbulent times in the market. Our team includes veterans from SoFi, Nuveen, and state pension funds who have invested through numerous market crises.

Our 50+ years of investment and compliance experience makes one pattern clear: When storms hit, there is always a flight to safety - and in today’s environment, that safety is in government backed securities.

Even in normal times, CIOs like myself urge broad diversification between cash held at a business bank and cash equivalents like money market funds backed by government securities and holding treasury bills. One of the key tenets of treasury management is minimizing risk associated with holding large amounts of idle cash. It isn't just about the return on your cash, but also the return of your cash. From this perspective, holding government backed securities is, by far, the safest alternative to your cash sitting idle at a bank.

The two best ways to hold government back securities are:

  1. Holding Money Market Funds: These funds invest in only very short dated government backed securities, so these securities are very safe and very stable.
  2. Holding T-bills: T-bills are short dated debt issued by the US government, so they are the safest way to store idle cash given they come with the full faith and credit of the U.S government. No other asset is safer than a U.S. T-bill.

If you want to minimize risk and store your business cash in ultra-safe alternatives, Treasure Financial can safely allocate your cash in government backed securities. It takes less than 10 minutes to open an account. Get started at Treasurefinancial.com - and reach out to our team with any investment and treasury management questions.

Ben Verschuere, Co-Founder/CIO
Treasure Financial

More from the Blog

Gemini created image
Dear Bank: Here's How You Can Slash Deposit Costs and Delight Customers (Yes, Really!)

For years, the holy grail for banks has been attracting and retaining low-cost deposits. What if there was a way to keep your customers happy and decrease your funding costs? One answer lies in investment products.

Read More
EconomyMay 2024 Economic Snapshot
May 2024 Economic Snapshot

Treasure's Chief Investment Officer provides you with a quick 2 minute overview of what happened last month in the financial world.

Read More
NewsTreasure Partners with Unit a Leader in Embedded Banking Services
Treasure Partners with Unit a Leader in Embedded Banking Services

Treasure is excited to share its partnership with Unit, a leading Fintech providing embedded banking services.

Read More
Treasure Technologies Inc.
447 Sutter St
STE 405 PMB 25
San Francisco, CA 94108
Website is operated by Treasure Investment Management, LLC ("Treasure"), a wholly-owned subsidiary of Treasure Technologies, Inc., and an investment adviser registered with the U.S. Securities and Exchange Commission ("SEC"). Brokerage services are provided to clients of Treasure by Apex Clearing Corporation ("Apex"), an SEC-registered broker-dealer and member FINRA.

Investing involves risk, including loss of principal. The contents of this website are provided for information purposes only and do not constitute an offer to sell or a solicitation to buy securities. Past performance is no guarantee of future returns.