Cash surpluses in your business deserve to be managed professionally, so that income can be generated and risks kept under control. When your business has cash surpluses it can go without for a longer period of time, then funds with a floor-protection mechanism are definitely worth considering.
Why invest through a fund?
What are funds with a floor-protection mechanism?
These funds attempt to limit any losses by monitoring an annual floor price. To protect the floor price, the fund invests in both risk-bearing assets (shares, bonds, real estate and alternative investments) and risk-mitigating assets (such as cash).
When the markets are performing well, the fund invests in as many risk-bearing assets as possible. When they are performing less well, the fund will scale down holdings of risk-bearing assets and increase risk-mitigating ones in order to protect the floor price.
The fund's floor price changes each year on the basis of the net asset value.
Note: Floor-price monitoring does not entail any guarantee whatsoever. Funds with this mechanism do not provide any capital protection or capital guarantee, nor do they offer a guaranteed return.
Which funds can you choose from?
KBC Bank offers funds with a floor price at 90% or 95% that are specially suited to companies. The floor price concerned is valid for a year and, depending on the fund, is set in April, August or November.
If you run a company that's looking for safe investment, a product with a guaranteed minimum return could well be what you want.
Combination of a savings account and a term investment
Ideal for structural cash surpluses which you can go without for a while and which you can access after having given 32 days’ notice.
Savings account for non-profit organisations, public authorities and autonomous entities
Create a financial reserve for contingencies. And earn interest right up to the day you withdraw your cash.