CDs are time deposits. You agree to place your funds on deposit with a bank for a stated period of time. During the term of the CD, your funds earn interest at either a stated interest rate or at a rate based upon an agreed method of calculation, such as the percentage increase in the stock market. We use them as short-term investments (1-2 years) in tax deferred accounts.
We also may use CDs with rates that have a variable rate (such as Prime Rate) or a contingent rate (linked to stock market). CDs are taxable, although taxes can be deferred in IRAs. (Such deferrals may have a penalty for early withdrawal.) CDs are FDIC insured up to $250,000 per account holder.
CDs that are currently available to our clients through TD Ameritrade Institutional (subject to availability) - 1/24/2013
| Bank Name | Qty | Coupon | Term | Maturity | Callable | YTC | YTM | Price | Pays |
|---|---|---|---|---|---|---|---|---|---|
| Wachovia Bank | 5 | 5.05% | 8 month | 9/30/2013 | noncallable | nc | 1.00% | $102.67 | semi |
| Morgan Stanley Bank | 25 | 5.00% | 10 month | 11/29/2013 | noncallable | nc | 1.00% | $103.72 | semi |
| Discover Bank | 25 | 1.10% | 29 month | 6/8/2015 | noncallable | nc | 1.00% | $100.23 | semi |
| American Express | 4 | 3.50% | 4 year | 12/2/2016 | noncallable | nc | 1.35% | $108.06 | semi |
| Goldman Sachs Bank | 35 | 2.10% | 6.5 year | 8/29/2019 | noncallable | nc | 2.10% | $100.00 | semi |
| Goldman Sachs Bank | 75 | 3.00% | 14.25 year | 4/30/2027 | 4/30/2013 | 3.00% | 3.00% | $100.00 | mthly |