2006-09-09 20:13:12 · 6 answers · asked by MelB 1 in Business & Finance ➔ Personal Finance
certificate of deposit ............
2006-09-09 20:14:42 · answer #1 · answered by BIGG AL 6 · 0⤊ 0⤋
CDs are Certificates of Deposit its a fany accountancy term for Owners Equity and a direct investment from a consumer into the bank so the bank may then lend the money to a person or entity seeking a loan. When you get a CD u also get a dividend or a return on ur investment.
2006-09-09 20:20:18 · answer #2 · answered by cassie 2 · 0⤊ 0⤋
CD means Certificate of Deposit. It is a fairly risk-free and generally short-term cash investment. You choose the length of it, from 1 month to several years, and unless you're willing to pay a penalty, you cannot withdraw your money until the CD has reached maturity so it is not a "liquid" investment like a typical savings account or money market fund. A good article there comparing CD and money markets: http://beginnersinvest.about.com/cs/banking/a/062501a.htm
Naturally, the longer the CD, the higher the yield (interest served on the amount you invested). See example here: http://home.ingdirect.com/products/products.asp?s=OrangeCD or here http://www.bankrate.com/gookeyword/rate/deposits_home.asp?
Note that CD's are FDIC insured (up to $100K).
2006-09-11 20:43:39 · answer #3 · answered by PP 2 · 0⤊ 0⤋
CD stands for Certificate of Deposit. Banks are not just keepers of accounts. They hold money and pay interest as well as lend money and collect interest. The purpose fo CDs is to keeper money for a set period of time for which they will pay interest so that they can lend money. While there are a variety of savings accounts out there, a CD usually pays higher interest because they know how long the money will be at their disposal. Which is also why there are significant penalties if you take your money back early. They relied on it being there, and by reneging on your end of the deal they put themselves at greater risk.
Most people look at financial institutions as entities looking for a way to screw you out of money just because your need changed and it's YOUR money. It's much more complex than that.
2006-09-09 20:44:43 · answer #4 · answered by misslabeled 7 · 0⤊ 0⤋
a saving instrument banks offer. set rate intrest for a set time
2006-09-10 04:52:08 · answer #5 · answered by moonwalker 3 · 0⤊ 0⤋
yes.....certificate of deposits
2006-09-09 20:19:52 · answer #6 · answered by Anonymous · 0⤊ 0⤋