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It's not an automatic sweep, but anyone holding cash at Schwab moves it to something like SWVXX [1] paying ~5% right now. [1] https://www.schwabassetmanagement
by matwood 3y ago
It's not an automatic sweep, but anyone holding cash at Schwab moves it to something like SWVXX [1] paying ~5% right now.
[1] https://www.schwabassetmanagement.com/products/swvxx https://www.schwabassetmanagement.com/products/swvxx
- everybodyknows 3y agoBeware that such a mutual fund buy transaction closes at end of day. A sale of a stock or ETF closes 2-3 days in the future. So if you place both orders concurrently in your margin account, you may find you've borrowed from Schwab for those 2-3 days on margin, at a rate of ~10%. Schwab's order screen will not warn you of this in advance. What happens if you make this mistake in a "cash account" i.e. no margin allowed I do not know and hope not to find out by means of usual accidental carelessness. An alternative to SWVXX is VUSB, which trades with standard ETF timing.