Moomoo Cash Plus Review: Cash management account with lowest minimum investment

What is Moomoo Cash Plus?

If you are an active stock investor in Singapore, moomoo should be a familiar name to you

However, what you might not know about is moomoo Cash Plus, which aims to generate potential returns for your idle cash with greater flexibility. 

What it aims to do, is to preserve your principal value and maintain a higher degree of liquidity while generating a potential return. 

What does Moomoo Cash Plus invest in?

When you put your money into moomoo Cash Plus, you have a choice of investing in either the Fullerton Cash Fund (Singapore Dollar) or the CSOP USD Money Market Fund.

The CSOP USD Money Market Fund offers a 7-day annualised yield of 4.46%, while the Fullerton SGD Cash Fund offers a 7-day annualised yield of about 3.88% as of 11th April 2023. 

Curious as to what these funds invest in? We helped you to do the work by looking at the Fullerton Cash Fund factsheet. 

The investment objective of the fund is to “provide investors with liquidity and a return that is comparable to that of the Singapore Dollar Banks Savings Deposits rate”

What it does is really to hold assets in Singapore Dollar deposits with eligible financial institutions.

For example, based on its July 2022 factsheet, the Singapore Dollar deposits are held with financial institutions such as Landesbank B-Wurttemberg, Qatar National Bank, and Bank of Tokyo-Mitsubishi UFJ-Singapore. 

The placement period to maturity of these assets is generally very short term, with 89% of assets maturing within 4 weeks. 

What are the benefits of Moomoo Cash Plus?

#1 - Relatively safe investment option

According to moomoo SG, one of the benefits of moomoo Cash Plus is that the funds have not seen any negative monthly return to date. This is because they are held generally as Singapore dollar deposits. 

Looking at the historical returns of Fullerton Cash Fund since its inception in 2009, it is true that there has not been any negative monthly return.

Fullerton is a reputable fund management company and part of Seviora, a holding company established by Temasek. NTUC Income is also a minority shareholder of Fullerton. 

#2 - Low-cost 

The other benefit is that this is a low-cost investment option as subscription and redemption fees are zero. 

The fee incurred lies mainly in the expense ratio of the funds. For example, the Fullerton Cash Fund has an expense ratio of 0.15% for financial year ended 31 March 2022. 

#3 - Start with a small amount

You can invest from as low as $0.01, which is great if you want to start with a small amount. 

#4 - Flexible

moomoo Cash Plus is highly liquid. You can redeem from moomoo Cash Plus anytime you like, and instantly trade stocks with your funds.

You may also choose to withdraw the funds and deposit the cash into your bank account.  

What are the key risks of putting your money with moomoo Cash Plus?

#1 - Not capital guaranteed

moomoo Cash Plus is not capital guaranteed. While the primary objective of the cash management fund is to achieve a return that is comparable to the SGD savings deposit rate, there is effectively still a chance that there could be a negative return in a single day in some extreme cases. 

#2 - Not insured under SDIC

Deposits into moomoo Cash Plus are not insured under Singapore Deposit Insurance Corporation Limited (SDIC).

What would Beansprout do?

If you are looking for another place to park your spare cash outside of the Singapore Savings Bond and SGS Bond, the moomoo Cash Plus would be another option to explore.

It offers you the following advantages:

• Quick subscription and redemption as the funds can be withdrawn at any time
• Relatively safe underlying fund selection investing in Singapore dollar deposits