Bull CD

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.

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RELATED FAQS
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    Learn how interest earned on a certificate of deposit is taxed and how this may reduce the total return of an investment ... Read Answer >>
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    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 >>
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