Certificate of Deposit-CD

Certificate of deposit, also known as CD in short, are a savings certificate which yield interest to the bearer. A CD typically has a maturiy date, a fixed interest rate, and can be issued in any denomination. CDs are usually issued by commercial  banks and insured by the FDIC.

Investors should pay attention to the fact that CDs have fixed interest rates and therefore usually do not fluctuate with market interest rates. Early withdrawals are possible but usually will incur penalties.

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