Difference between revisions of "Certificate of deposit"

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Certificates of deposit (or CDs) are [[debt instruments]] issued by [[banks]] and other financial institutions to [[investors]]. The investor is paid a set rate of [[interest]] in exchange for [[lending]] the institution money for a predetermined length of time. [[Maturities]] on certificates of deposit range from a few weeks to several years; the interest rate earned by the investor increases in proportion to the time his or her [[capital]] is tied up in the [[investment]]. <ref>{{cite web|url=http://beginnersinvest.about.com/cs/banking/a/062501a.htm|name=In this Corner: Money Market vs. Certificate of Deposit|org=About.com|date=January 20, 2009}}</ref>
Certificates of deposit (or CDs) are [[debt instruments]] issued by [[banks]] and other financial institutions to [[investors]]. The investor is paid a set rate of [[interest]] in exchange for [[lending]] the institution money for a predetermined length of time. [[Maturities]] on certificates of deposit range from a few weeks to several years; the interest rate earned by the investor increases in proportion to the time his or her [[capital]] is tied up in the [[investment]]. <ref>{{cite web|url=http://beginnersinvest.about.com/cs/banking/a/062501a.htm|name=In this Corner: Money Market vs. Certificate of Deposit|org=About.com|date=January 20, 2009}}</ref>


 
Certificates of deposited are FDIC-insured for up to $100,000.


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Revision as of 23:39, 20 January 2009


Certificates of deposit (or CDs) are debt instruments issued by banks and other financial institutions to investors. The investor is paid a set rate of interest in exchange for lending the institution money for a predetermined length of time. Maturities on certificates of deposit range from a few weeks to several years; the interest rate earned by the investor increases in proportion to the time his or her capital is tied up in the investment. [1]

Certificates of deposited are FDIC-insured for up to $100,000.


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