Cash vs investing – where should investors look when the interest rate cycle turns?

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With the interest rate cycle nearing its peak, we look at cash versus investing in the stock market, and where investors could look for opportunities.

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

Published on 27 October 2023

It was correct at the time of publishing. Our views and any references to tax, investment and pension rules may have changed since then.

This year has been a two-horse race when it comes to asset allocation. Investors have been going for the quintessential bar-bell approach – all risk and low risk – of tech stocks and cash.

Third quarter trades on our platform revealed investors have been buying plenty of money market funds and exchange traded funds (ETFs). But also NASDAQ and tech trackers and a few US share and developed market options – also chock full of big tech.

Money market funds have been a consistent fixture in the top-buys lists this year – and that’s a concern.

This article is not personal advice. Unlike the security offered by cash, all investments and any income they produce will rise and fall in value, meaning you could get back less than you invest. If you’re not sure an investment is right for you, ask for financial advice.

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