Investment Options- How To Understand

During the Account Opening process, users are prompted to select how the initial funds will be handled. This step determines whether cash is deposited, invested immediately, or invested into a specific model once received.

 Depositing adds cash to the account without investing it into a model.

 This option is typically used when the intention is to hold cash temporarily, or when the investment model hasn’t yet been agreed.

Important: Using this option does not automatically ring-fence the cash. You must manually apply a ring-fence before the funds arrive to ensure the money remains in cash, or alternatively use the suspend trading status.

If the funds later need to be invested (without affecting the existing holdings): Go to All Account Actions (double cog icon) - Portfolio Switch/Rebalance - Invest Surplus Cash.

Rebalancing adjusts the portfolio by buying and selling holdings to return it to the model’s original weightings. Selecting this option invests the incoming cash and rebalances the current holdings automatically.

Use this when:

• You want the entire portfolio (existing and new funds) to align with the current model’s target allocation.
• There have been prior deviations from model weights that you now want corrected.

 This option creates a model switch instruction that trades out of the current model and into the new one.

  When the new funds arrive, they are automatically invested into the new model.

Use this when:

• The client is moving to a different model as part of the new investment.
• You want both existing and new funds realigned to the new model on receipt of the cash.

This option invests the incoming funds proportionately across the current model’s weightings but does not rebalance existing holdings.

Use this when:

• You want to invest the new cash following the same model allocation,
• but don’t want to disturb or rebalance the current holdings.

Note: Buying Power ensures sufficient cash is available to complete model trades.