DEFINITION of 'Bull CD'

A certificate of deposit whose interest rate fluctuates in direct correlation to the value of an underlying market index. In other words, the interest rate paid on the CD increases as the value of the market index increases during the life of the CD.

BREAKING DOWN 'Bull CD'

This type of CD is most often used by investors looking for a very safe investment that also gives them exposure to the stock market. The CD interest rate does not lose value if the market falls in value because there is a minimum rate that has to be paid.

RELATED TERMS
  1. Bear CD

    A certificate of deposit whose interest rate fluctuates in inverse ...
  2. Index-Linked Certificate Of Deposit

    A certificate of deposit (CD) with a return based on a specific ...
  3. Liquid Certificate Of Deposit

    A certificate of deposit (CD) that allows withdrawls to be made, ...
  4. Indexed Certificate Of Deposit ...

    A savings certificate entitling the bearer to receive an interest ...
  5. Variable-Rate Certificate Of Deposit

    A certificate of deposit (CD) with a variable interest rate. ...
  6. Callable Certificate Of Deposit

    An FDIC insured certificate of deposit (CD) that contains a call ...
Related Articles
  1. Investing

    Are CDs Good Protection For The Bear Market?

    Certificates of deposit promise stable income in any market, but do they deliver?
  2. Investing

    How To Earn The Most From CDs When Interest Rates Are Low

    Certificates of deposit might not seem like a good place to keep your money when interest rates are low, but they do offer security and stability. And with laddering and studying promotional ...
  3. Managing Wealth

    Save Smart With A CD Ladder

    A CD Ladder allows you to stagger your investments and take advantage of higher interest rates.
  4. Investing

    Getting Certificates of Deposit (CDs) in Emerging Markets: Risks and Rewards

    Learn about the risks and rewards associated with investing in a certificate of deposit (CD) offered by an emerging market and what to consider before buying.
  5. Investing

    Callable CDs: Check The Fine Print

    These offer higher returns than regular certificates of deposit, but there's a catch.
RELATED FAQS
  1. How are yields taxed on a certificate of deposit (CD)?

    Learn how interest earned on a certificate of deposit is taxed and how this may reduce the total return of an investment ... Read Answer >>
  2. What are the typical durations for a certificate of deposit?

    Investing in a certificate of deposit offers individuals the ability to earn interest on idle funds with less risk than stock ... Read Answer >>
  3. Can certificates of deposit (CDs) lose value?

    CDs are FDIC insured, so they do not lose face value, though broker-issued CD accounts do carry risks. Read Answer >>
  4. How safe an investment is a certificate of deposit?

    Discover certificates of deposit, their basic makeup and numerous variations, and understand why they are some of the safest ... Read Answer >>
Hot Definitions
  1. Market Capitalization

    The total dollar market value of all of a company's outstanding shares. Market capitalization is calculated by multiplying ...
  2. Frexit

    Frexit – short for "French exit" – is a French spinoff of the term Brexit, which emerged when the United Kingdom voted to ...
  3. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  4. Down Round

    A round of financing where investors purchase stock from a company at a lower valuation than the valuation placed upon the ...
  5. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  6. Portfolio Investment

    A holding of an asset in a portfolio. A portfolio investment is made with the expectation of earning a return on it. This ...
Trading Center