Cash Sweep with Minimum Balance Example

The following example illustrates how the system uses the minimum balance when you run the cash sweep process.

In this example, the entity's:

• Cash Sweep field is set to Yes.

• Minimum Balance field is set to 20. The amount implies the entity's base currency, such as USD.

• Lookup STIF Issue Name is FMC Money Market.

• Base Currency is set to USD.

Day 1

The following table shows Balances before the sweep process.

Run Cash Sweep

The balance is greater than the minimum $20. The system uses the $100 to purchase 100 units of FMC Money Market security at a price of 1, because Price of 1 is the default value in the sweep process.

Day 2

The system processes cumulative USD settlements that create a negative balance of $30.

Run Cash Sweep

The negative balance of $30 must be brought to zero. The system sells 30 units of FMC Money Market Units at a default price of 1, which creates traded and settled rows to bring the cash balance to 0 and the Money Market security unit balance to 70.

Day 3

The system processes cumulative USD settlements that create a positive balance of $15.

Run Cash Sweep

The positive cash balance is less than the minimum amount to sweep. The system does not perform the sweep process for this entity.

Day 4

The system processes cumulative USD settlements that create a negative balance of $10.

Run Cash Sweep

Even though the amount to sweep is less than the $20 minimum. the balance is negative. As a result, the sweep must still be processed to bring the cash balance to $0.

On this page