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How does a company like Apple insure their billions of dollars of cash?
by crummy 4y ago
How does a company like Apple insure their billions of dollars of cash?
- khalilravanna 4y agoIt sounds like they invest somewhat conservatively. By spreading across different issuers they’ll likely be insured more than if they put all their money in one pot. But given the amount of money I imagine the actual amount fully insured would be low. Maybe someone else has more details. > The company typically invests in highly rated securities, and its investment policy generally limits the amount of credit exposure to any one issuer. The policy generally requires investments to be investment grade, with the primary objective of minimizing the potential risk of principal loss. https://www.fool.com/investing/general/2016/04/05/by-this-measure-apple-is-the-worlds-largest-hedge.aspx https://www.fool.com/investing/general/2016/04/05/by-this-me...
- em500 4y agoNot privy to their financial management, but it's unlikely that they keep billions of dollars in cash. How it usually works when you have huge piles of legit cash coming in is, you buy short duration T-Bills that you keep rolling over and/or money market funds. The richer you are, the less actual cash you need. When you have excellent credit and incoming cash flow, you barely need any actual cash to pay people; you just need to issue an IOU or have your bank advance the cash for you.