Question
What role, if any, will short-term investments play in your portfolio? Why? Complete the following table for the short-term investments listed. Find their current yields
What role, if any, will short-term investments play in your portfolio? Why? Complete the following table for the short-term investments listed. Find their current yields online, and explain which, if any, you would include in your investment portfolio. The short term investment will be a Certificate of Deposit (CD). The current yield is 1.90% apy.
Type of Investment | Minimum Balance | Interest Rate | Federal Insurance | Method and Ease of Withdrawing Funds |
a. Passbook savings account | None | Yes | In person or through teller machines; very easy | |
b. NOW account | Unlimited check-writing privileges | |||
c. Money market deposit account (MMDA) | ||||
d. Asset management account | ||||
e. Series I savings bond | Virtually none | |||
f. U.S. Treasury Bill | ||||
g. Certificate of deposit (CD) | ||||
h. Commercial paper | ||||
i. Bankers acceptance | ||||
j. Money market mutual fund (money fund) |
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