Callable Certificate Of Deposit

Filed Under » , ,
Dictionary Says

Definition of 'Callable Certificate Of Deposit'

An FDIC insured certificate of deposit (CD) that contains a call feature similar to other types of callable fixed-income securities. Callable CDs can be redeemed (called away) by the issuing bank prior to their stated maturity, usually within a given time frame, and at a preset call price.
Investopedia Says

Investopedia explains 'Callable Certificate Of Deposit'

A bank adds a call feature to a CD so it does not have to continue paying a higher rate to the CD holder if interest rates drop. Callable CDs are often redeemed at a premium to their purchase price as an incentive for investors to take the call risk.

For example, if a bank issues a traditional CD that pays 4.5% to the investor, and interest rates fall to a point where the bank could issue the same CD to someone else for only 3.5%, the bank would be paying 1% higher rate for the duration of the CD. By using a callable CD, the bank can pay a premium to stop paying the higher rate.
Search results for

'Callable Certificate Of Deposit'

  • Callable CDs: Check The Fine Print

    http://www.investopedia.com/articles/bonds/07/callable_cd.asp
    ... disappointed. Just like a regular CD, a callable CD is a certificate of deposit
    that pays a fixed interest rate over its lifetime. The ...

  • 8 Ways To Lose Money On Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/lose-money-bonds/certificate-deposit-cd.aspx
    ... Cashing in your certificate of deposit (CD) early ... (Read about another risk associated
    with CDs in Callable CDs: Check The Fine Print.). Related SlideShows. ...

  • 8 Ways To Lose Money On Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/lose-money-bonds/certificate-deposit-cd.aspx?lastSlide=1
    ... Cashing in your certificate of deposit (CD) early ... (Read about another risk associated
    with CDs in Callable CDs: Check The Fine Print.). Related SlideShows. ...

  • Top 4 Strategies For Managing A Bond Portfolio

    http://www.investopedia.com/articles/bonds/08/bond-portfolio-strategies.asp
    ... While this works well when shopping for a certificate of deposit (CD) at ... that passive
    strategies work best with very high-quality, non-callable bonds like ...

  • Series 65 Study Guide - Cash Equivalents and Fixed Income ...

    http://www.investopedia.com/exam-guide/series-65/cash-equivalents-fixed/cash-equivalents.asp
    ... There are several types of cash equivalents: Certificates of Deposit - CDs: While ...
    negotiable CDs may include an option to define them as "callable." Many people ...

  • 8 Ways To Lose Money On Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/lose-money-bonds
    ... Cashing in your certificate of deposit (CD) early ... (Read about another risk associated
    with CDs in Callable CDs: Check The Fine Print.). Related SlideShows. ...

  • 8 Ways To Lose Money On Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/lose-money-bonds/treasury-protected-securities-deflation.aspx
    ... Cashing in your certificate of deposit (CD) early ... (Read about another risk associated
    with CDs in Callable CDs: Check The Fine Print.). Related SlideShows. ...

  • 8 Ways To Lose Money On Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/lose-money-bonds/interest-rate-credit-downgrade-restructuring.aspx
    ... Cashing in your certificate of deposit (CD) early ... (Read about another risk associated
    with CDs in Callable CDs: Check The Fine Print.). Related SlideShows. ...

  • 8 Ways To Lose Money On Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/lose-money-bonds/foreign-exchange-rate.aspx
    ... Cashing in your certificate of deposit (CD) early ... (Read about another risk associated
    with CDs in Callable CDs: Check The Fine Print.). Related SlideShows. ...

  • 8 Ways To Lose Money On Bonds Slideshow | Investopedia

    http://www.investopedia.com/slide-show/lose-money-bonds/mutual-fund-management-redemption.aspx
    ... Cashing in your certificate of deposit (CD) early ... (Read about another risk associated
    with CDs in Callable CDs: Check The Fine Print.). Related SlideShows. ...

Related Articles

Bank Rates
Product Today Last Wk
$10K MMA 0.50% 0.51%
MMA 0.45% 0.46%
6 Month CD 0.46% 0.47%
1 Year CD 0.70% 0.75%
5 Year CD 1.46% 1.46%
1 Year Jumbo CD 0.66% 0.67%
Rate data provided by Bankrate
Product Today Last Wk
$30K HELOC 4.59% 4.60%
$30K Home Equity Loan 5.74% 5.77%
$50K Home Equity Loan 5.45% 5.50%
$50K HELOC 4.24% 4.24%
$100K Home Equity Loan 5.41% 5.46%
$100K HELOC 4.13% 4.13%
Rate data provided by Bankrate
Product Today Last Wk
30 Year Fixed 3.80% 3.80%
15 Year Fixed 3.09% 3.11%
1 Year ARM 3.54% 3.53%
30 Year Fixed Jumbo 4.38% 4.38%
5/1 ARM 2.65% 2.69%
3/1 ARM 2.69% 2.69%
Rate data provided by Bankrate
Product Today Last Wk
60 Month Used Car Loan 4.51% 4.51%
48 Month Used Car Loan 4.35% 4.35%
48 Month New Car Loan 3.24% 3.24%
36 Month Used Car Loan 4.34% 4.36%
36 Month New Car Loan 3.11% 3.13%
60 Month New Car Loan 3.35% 3.34%
Rate data provided by Bankrate
Partner Links