cash out refinance vs HELOC and starting out strategy

[David O.]

I am a newbie to BiggerPockets and would appreciate some advice. My wife and I have accumulated some savings that I think can allow us to retire comfortably even though we are still young and may be working for another 20 years. I had been a landlord remotely after selling our last primary residence and finally decided to sell it last year. We recently bought another rental property in Austin and want to buy more rental property as I just realized the great investment potential in real estate. 

We have ~$1M invested in mutual funds that we can sell after paying tax on the gain over the years which we can use to invest in rental real estate; we can also do a cash-out refinance on our primary home to free up ~$800K equity. We plan to refinance anyway with cash out or not as it will lower our interest rate, though the cash out option will have 0.125% higher interest rate than the non-cash out option.

Our dilemma is should we do a cash-out refinance or a regular refinance for now? If we do regular refinance, we may take out a HELOC in the future if we need additional cash to invest in rentals. I am leaning towards the cash-out refinance as it allows me to lock in the current low interest rate - I will probably park the cash in stock market while looking for deals in rentals. I understand HELOC gives me more flexibility especially when we are not too sure what/where to invest in now, but I do not like the fact that its interest rate will increase in the future. Is there any problem with this strategy? I have never intentionally tried to become a landlord and real estate investor before and I am starting new even though we have bought and sold multiple primary homes, therefore I would really appreciate any advice on the strategy, where to invest (I am in SF bay area), where/what I should learn...

Thank you so much!

[Justin Phillips]

@David O. I'm a big proponent of a very specialized 1st position Heloc that's tied to a Zero Balance sweep checking account. With it you get all of the benefits @Jody Sperling mentioned from more traditional Helocs, but that Sweep checking account really brings it to the next level. With that ZBA, all regular banking deposits/idle funds are automatically swept to the balance of your line every night at midnight. So all my regular deposits work much harder than they would in any "high-yield" savings account, tax free. Along with that, there's a 30 year draw period for equity. And to @Arlen Chou 's point/concern, since it's specifically designed to only sit in 1st position, it has staying power more similar to that of a 30 year fixed mortgage. 
It's been an awesome tool for me.