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Certificate of Deposit

Posted on: 31st Mar, 2004 03:25 am
Certificate of Deposit (CD) is a certificate of confirmation on savings account issued by a bank or any other financial institution. It includes the institution's promise to return the deposit, plus gains at a specific interest rate within a specified period. The bank may charge penalty on any withdrawal form this account before the maturity period.

Customers agree to lend money to the institution for certain period of time as due to a secure way of earning interest amount on the investment.

A certificate of deposit with an investment under $1,00,000 is called ''Small CD'' whereas that with an investment above $1,00,000 is known as ''Large CD'' or ''Jumbo CD''.

Related Article
what are callable certificate of deposits, is there any difference between them and traditional certificate of deposits
Posted on: 01st Jan, 2007 02:27 pm
Hi Lerman,

Callable Certificate of deposit is different from traditional certificate of deposit in the sense that with such CDs, the bank keeps its rights to call (buy back) the investment.

There is an initial non-callable time period, after which the bank has the right to buy back the certificate of deposit.

As these are callable they also have high interest rates. On the due call date the bank which had issued the callable CDs determines whether it will be better to replace or leave the investment outstanding.

Posted on: 01st Jan, 2007 02:38 pm
Certificate of Deposits are among the safest investment a persona can make. The interest rate is determined ahead of time, and you're guaranteed to get back what you put in, plus interest once the CD matures. Generally speaking, the longer the term the better the yield on the money. But on the subject of rate or return, every person wants a higher interest rate of which a certificate of deposit may provide the sort of safety that many casual investors crave, but accessible rates of interest have not been high for a while. In most instances, high-yield checking accounts offer greater return than CDs to consumers for their cash.
Posted on: 26th Mar, 2012 11:34 pm
A certificate of deposit (CD) is a financial product which is issued to the consumers in the country by banks, credit unions and thrift institutions. CDs are insured by the Federal Deposit Insurance Corporation (FDIC). This is like a saving certificate which empowers the bearer to receive interest.
Posted on: 28th Mar, 2012 02:41 am
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