This new " Cash Investment" product has been poorly communicated. Itās like, āJust park your money here, low-risk, high interestā, but itās clearly more than that.
The bumpf looks like itās been rushed.
KIID is the Key Investor Information Document all investors should read before buying such funds. In the Freetrade app, when you click on one of these funds, it would be āKey Information Documentā which you download to read.
YTM is the Yield to Maturity which refers to the total return anticipated on a bond if a bond is held until it matures.
Interest paid will probably vary per investment, so probably will be in the KIID, which will probably state if interest is paid as income or accumulated.
Iām interested but will be researching more before I park any money 
Thanks Weenie.
Indeed, itās clearly not the simple-sounding, easy interest-earning product portrayed. I wonāt be piling-in until FT adds more meat to the sizzle itās trying to sell.
I donāt fully understand these ETFs. Why would I buy these instead of using a cash savings account?
Generally you wouldnāt, particularly for money you want instant access to such as emergency funds.
An advantage of money market funds is interest rate rises from the BoE are passed on more quickly though this will reverse when rates decline, so you may be better off locking in a fixed account.
To my mind, the main use for these funds is for parking cash you donāt want to invest yet. But even then, Iād rather just invest right away.
Thatās my thoughts as well 
Itās a good option to hold in an ISA if you want to dollar cost average or wait till you decide what shares you want to buy.
They arenāt trying to sell anything they have no vested interest to force you to put money into these things itās just an alternative option to cash savings, they arenāt saying itās suitable for you or anyone just making people aware these etfs are available.
They offer good interest via yield and can be used within an ISA to avoid the tax on savings interest in a bank account.
Rates are higher than your average savings account too.
I personally dont like how FT have marketed this. They have called them āhigh yieldā which is terminology used to describe high risk lower quality bonds. Using this terminology undermines what they are trying to promote.
They have packaged up a bunch of ETFs which are provided by investment firms and are promoting them as their own products. āWhat are Freetradeās cash investments?ā
Yes, well all marketing could be termed making people aware.
Iām not looking for an argument, just to say, if FT is going to market (make us aware) of a new product, then educate us as to how it works, warts ānā all.
So far, this thread has been more helpful than what it marketed, so Iām glad I opened it, but then weāre just random strangersā¦
Agreed. Maybe this type of product is the best thing since sliced bread, who knows.
As I donāt understand it, Iām not going near it with a bargepole until I do understand it.
Just to explain why this will not happen, Freetrade are an execution-only broker. Theyāre arenāt allowed to āeducatedā anyone as this could be seen as giving advice. I do get your point about this being a new type of investment and there being an need some one to education oneās self however.
They canāt provide advisory content, but they certainly could provide basic educational materials to help people make informed decisions (and have done in the past).
Sure there are grey areas but thereās a lot you can say about what these are and how they work before you start recommending someone buy one.
Where have Freetrade recommended anyone to buy one?
They havenāt, thatās the thing they arenāt allowed to do.
At the risk of being lynched by the fanatics, Iām going to play devilās advocate.
I think FT treads a fine line by marketing specific securities.
After all, the broker will have seen a surge of people buying these ETFs after promoting them.
While not a personal recommendation, speaking to their merits, eg āhigh yield, low risk, easy access, whatās not to love?ā, borders on advice to my mind.
Slap āWhich? recommendedā and āFCSC protectedā badges on the advertisement and, as a whole, thatās surely going to influence some people.
However, Iād expect/hope that FTās working within the relevant regulations and covered by disclaimers.
I try not to think of FT as execution-only broker any more due to extra elements such as marketing, gamification and this community which all affect investor behaviour in one way or another.
Iām going to get rid of this garbage first thing tomorrow, a net loss not counting missed opportunities.
I think there is a lot to get confused about.
Cash savings are what they are. If you have Ā£500 in a savings account then you have Ā£500 in a savings account. At some point or another you get a percentage of interest added.
These ETFs act like ETFs and or stocks in that the prices can rise or fall.
While yes you can get a return on your investment, oh for sure. This is a different ball game to cash savings in a savings account at a bank or building society.
Iām sure we all knew all of the above.
Maybe they need to call it something other than cash investment ETF as this can come off as misleading as cash doesnāt fluctuate like any exchange traded product.
While Freetrade did not make the name Cash investment ETF (or similar) perhaps the wider industry needs to have a rethink on what these should be called.
One advantage is a large portion of the āinterestā for tax purposes is considered a capital gain, so you can use up your capital gains allowance if that is something you want to do āsafelyā
Education isnāt giving advice if they just explain how it works, in full.