Cash management covers all direct and indirect activities related to the targeted administration and investment of a fund’s short-term cash balances. Alongside maintaining liquidity, the most important aim is to invest the cash balances as profitably as possible.
Specifically managing a fund’s liquidity by investing it with a variety of trading partners can reduce risks and increase flexibility. At the same time investors can generate higher interest income for their funds by outsourcing the cash balances to other market players. If the cash is required for investment purposes, they are available again at short notice.
Division of labour generates added value
Universal-Investment offers both investors and advisers /asset managers cash management as an additional service. This allows investors to profitably invest available liquidity. Universal-Investment can take over cash management functions from advisers/asset managers: this leaves them free to concentrate on their core competencies without also having to deal with liquidity issues when making investment decisions.