Certificate of deposit

certificates of depositcertificatesCDsCDShare certificatesbrokered CDsCD Accountcertificate of deposit accountscertificates of depositsdeposit certificate
A certificate of deposit (CD) is a time deposit, a financial product commonly sold by banks, thrift institutions, and credit unions.wikipedia
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Time deposit

term deposittime depositsTerm deposits
A certificate of deposit (CD) is a time deposit, a financial product commonly sold by banks, thrift institutions, and credit unions.
A time deposit or term deposit (also known as a certificate of deposit in the United States) is an interest-bearing bank deposit with a specified period of maturity.

Credit union

credit unionscaisse populairefederal credit union
A certificate of deposit (CD) is a time deposit, a financial product commonly sold by banks, thrift institutions, and credit unions.
Typical services include share accounts (savings accounts), share draft accounts (checking accounts), credit cards, share term certificates (certificates of deposit), and online banking.

Bank

Bankingbankerbanking system
A certificate of deposit (CD) is a time deposit, a financial product commonly sold by banks, thrift institutions, and credit unions.

National Credit Union Administration

National Credit Union Administration BoardNCUANational Credit Union Administration (NCUA)
In the USA, CDs are insured by the Federal Deposit Insurance Corporation (FDIC) for banks and by the National Credit Union Administration (NCUA) for credit unions.
By 1977, services available to credit union members expanded, including share certificates and mortgage lending.

Federal Deposit Insurance Corporation

FDICFederal Deposit Insurance Corporation (FDIC)Federal Deposit Insurance Corp
In the USA, CDs are insured by the Federal Deposit Insurance Corporation (FDIC) for banks and by the National Credit Union Administration (NCUA) for credit unions.

Truth in Savings Act

Truth in SavingsTruth in Savings Regulation DD
The Truth in Savings Regulation DD requires that insured CDs state, at time of account opening, the penalty for early withdrawal.
For example, a customer opening a certificate of deposit account must be provided with information about ladder rates (smaller interest rates with smaller deposits) and penalty fees for early withdrawal of a portion or all of the funds.

Savings and loan association

savings and loanthriftssavings and loan associations
A certificate of deposit (CD) is a time deposit, a financial product commonly sold by banks, thrift institutions, and credit unions.

Savings account

Savingssavings accountssaving accounts
CDs are similar to savings accounts in that they are insured "money in the bank" and thus virtually risk free. They differ from savings accounts in that the CD has a specific, fixed term (often one, three, or six months, or one to five years) and usually, a fixed interest rate.

Interest rate

interest ratesdiscount rateinterest
They differ from savings accounts in that the CD has a specific, fixed term (often one, three, or six months, or one to five years) and usually, a fixed interest rate.

Maturity (finance)

maturitymaturity datematurities
The bank intends that the customer hold the CD until maturity, at which time they can withdraw the money and accrued interest.

Interest

simple interestrate of interestinterest rates
The bank intends that the customer hold the CD until maturity, at which time they can withdraw the money and accrued interest.

Floating interest rate

variable ratefloatingfloating rate
Fixed rates are common, but some institutions offer CDs with various forms of variable rates.

Stock market

equity marketstock marketsstock
Sometimes, financial institutions introduce CDs indexed to the stock market, bond market, or other indices.

Bond market

credit marketcredit marketsdebt market
Sometimes, financial institutions introduce CDs indexed to the stock market, bond market, or other indices.

Online banking

internet bankinge-bankingelectronic banking
Consumers who want a hard copy that verifies their CD purchase may request a paper statement from the bank, or print out their own from the financial institution's online banking service.

Opportunity cost

opportunity costshidden costhidden costs
A common mitigation strategy for this opportunity cost is the "CD ladder" strategy.

Interest rate risk

interest raterisk of interest rate fluctuations
Because of the call feature, interest rate risk is borne by the investor, rather than the issuer.

Reinvestment risk

Reinvestment rate risk
If the CD is called before maturity, the investor is faced with reinvestment risk.

Certificate of Deposit Account Registry Service

CDARS
The Certificate of Deposit Account Registry Service program lets investors keep up to $50 million invested in CDs managed through one bank with full FDIC insurance.

Real interest rate

negative real interest ratesrealinterest rate
Of course, these factors cancel out, so the real interest rate is the same in both cases.