If you want to keep your cash in USD – I would – I would also park the USD cash in US government bonds. Ideally pick one with a low interest coupon (as you’ll pay income tax on the interest). It won’t matter from a yield perspective, as low interest paying bonds will yield as much as higher interest paying ones, just via capital gains, for which you won’t be taxed.
Given your strategy (DCA into VT over the next 12 months) and in order to optimize fees I would probably pick any US government bond (with a low coupon) that matures in about 12 months and just sell parts as you DCA into VT. If you buy shorter term bonds and roll, you’ll probably occur higher trading fees (of course you then also would benefit from raising rates if those take place over the next 12 months, but as pointed out in more graphic topics, I expect the bond market to yank its chain on the Orange Swan if necessary.
(Any other scenario might play out, too, of course, from Trump firing Powell to lower rates or the bond market not being the big guy with a heavy club but us me just being reliant on the Treasury Secretary being able to talk to the Orange Swan without Peter Navarro being in the Oval Office.
Anyway, as always with the future (and IMO any macro deliberations): it is by definition not predictable).
If you wanted to get real fancy, you could even put those Treasuries to additional work via Treasury Secured Puts on the VT (rough outline here), which is what I would do if I wanted to buy VT over a given and defined time period as you seem to plan.
You’ll be paid (roughly) the Fed rate on your remaining USD cash (equivalent), you’ll additionally collect option premiums on the VT Puts you sell, and in the “worst case” you’ll occasionally be assigned VT shares (even without having to shell out a trading fee for buying them) that you wanted to buy anyhow.
Of course sizing and timing the option selling adequately is key, so stay away from this variant if this all sounds a little too funky for you.
Good luck!
Edit: fixed link to the Treasury Secured Puts discussion