DEFINITION of 'Jumbo CD'

A certificate of deposit (CD) with a minimum denomination of $100,000. Jumbo CDs have higher denominations than regular certificate of deposits, and allow investors to deposit a certain amount of money and receive interest. These investments are considered low-risk, stable investments for large investors. They typically pay interest at a higher rate than lower denomination CDs.

BREAKING DOWN 'Jumbo CD'

Jumbo CDs are typically bought and sold by large institutional investors, such as banks and pension funds, because of the high minimum denomination. Investors are mainly compensated for not having access to their money over the contract period. The longer the time period and the higher the denomination, the higher the interest rate will be.

RELATED TERMS
  1. Certificate Of Deposit - CD

    A savings certificate entitling the bearer to receive interest. ...
  2. Uninsured Certificate Of Deposit

    A certificate of deposit (CD) which is not insured against losses. ...
  3. Promotional CD rate (Bonus CD rate)

    A limited-time offer of a higher rate of return on a certificate ...
  4. Index-Linked Certificate Of Deposit

    A certificate of deposit (CD) with a return based on a specific ...
  5. Fixed-Rate Certificate of Deposit

    A certificate of deposit (CD) which has a set interest rate to ...
  6. Indexed Certificate Of Deposit ...

    A savings certificate entitling the bearer to receive an interest ...
Related Articles
  1. Investing

    Certificate of Deposit (CD)

    A certificate of deposit, or CD, is a common financial product sold by banks, thrift organizations and credit unions. This type of product is often called a time deposit. CDs are insured up to ...
  2. Investing

    Are CDs Good Protection For The Bear Market?

    Certificates of deposit promise stable income in any market, but do they deliver?
  3. 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.
  4. Investing

    CDs Vs. Inflation: Are They Keeping Up?

    Learn how to determine whether the money invested in certificates of deposit (CDs) can keep pace with the rate of inflation and how you measure inflation.
  5. Managing Wealth

    How To Create A Laddered CD Portfolio

    Laddered certificates of deposit offer safe capital and predictable cash flow, while bringing simplicity to your portfolio.
  6. Investing

    Long-Term Investing With Equity Index CDs

    Equity Index CDs are perfect for investors who don't mind hanging in for the long term.
RELATED FAQS
  1. 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 >>
  2. Are Certificates of Deposit (CDs) Taxable?

    Learn the tax consequences on certificates of deposit, how they are reported and how penalties on early withdrawals can affect ... Read Answer >>
  3. 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 >>
  4. 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 >>
  5. What is the safest investment?

    Learn about some of the safest investment types. Find out which investment categories offer the best protection on your principal ... Read Answer >>
Hot Definitions
  1. Aggregate Demand

    The total amount of goods and services demanded in the economy at a given overall price level and in a given time period.
  2. Fixed Cost

    A cost that does not change with an increase or decrease in the amount of goods or services produced. Fixed costs are expenses ...
  3. Blue Chip

    A blue chip is a nationally recognized, well-established, and financially sound company.
  4. Payback Period

    The length of time required to recover the cost of an investment. The payback period of a given investment or project is ...
  5. Collateral Value

    The estimated fair market value of an asset that is being used as loan collateral. Collateral value is determined by appraisal ...
  6. Fiduciary

    A fiduciary is a person who acts on behalf of another person, or persons to manage assets.
Trading Center