Unlike other investments, most CDs feature federal deposit insurance up to $250,000.
The ABCs of CDsĪ CD is a special type of deposit account with a bank or thrift institution that typically offers a higher rate of interest than a regular savings account. While most CDs feature federal deposit insurance, some CDs are more complex and may carry more risk, especially with respect to getting money back early or locking in an attractive interest rate. The SEC’s Office of Investor Education and Advocacy is issuing this Alert to inform investors about the potential risks of some high-yield CDs.
In combination with recent market volatility, advertisements for CDs with attractive yields have generated considerable interest in CDs.
When looking for a low-risk investment for their hard-earned cash, many Americans turn to certificates of deposit (CDs).
