Short-Term Investments

AAA

DEFINITION of 'Short-Term Investments'

An account in the current assets section of a company's balance sheet. This account contains any investments that a company has made that will expire within one year. For the most part, these accounts contain stocks and bonds that can be liquidated fairly quickly.

INVESTOPEDIA EXPLAINS 'Short-Term Investments'

Most companies in a strong cash position have a short-term investments account on the balance sheet. This means that a company can afford to invest excess cash in stocks and bonds to earn higher interest than what would be earned from a normal savings account.

Microsoft, which is always in a strong cash position, had short-term investments totaling approximately $32 billion at the end of 2005.

RELATED TERMS
  1. Reintermediation

    1. Individuals withdrawing funds from nonbank investments such ...
  2. Balance Sheet

    A financial statement that summarizes a company's assets, liabilities ...
  3. Cash

    Legal tender or coins that can be used in exchange goods, debt, ...
  4. Cash And Cash Equivalents - CCE

    An item on the balance sheet that reports the value of a company's ...
  5. Asset

    1. A resource with economic value that an individual, corporation ...
  6. Current Assets

    1. A balance sheet account that represents the value of all assets ...
Related Articles
  1. Reading The Balance Sheet
    Investing Basics

    Reading The Balance Sheet

  2. What Is A Cash Flow Statement?
    Markets

    What Is A Cash Flow Statement?

  3. Introduction To Fundamental Analysis
    Markets

    Introduction To Fundamental Analysis

  4. Advanced Financial Statement Analysis
    Options & Futures

    Advanced Financial Statement Analysis

comments powered by Disqus
Hot Definitions
  1. Effective Annual Interest Rate

    An investment's annual rate of interest when compounding occurs more often than once a year. Calculated as the following: ...
  2. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  3. Odious Debt

    Money borrowed by one country from another country and then misappropriated by national rulers. A nation's debt becomes odious ...
  4. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  5. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
  6. 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 ...
Trading Center