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Capital
Market is investment in
long-term securities such as
stocks and bonds. Compare to
Money Market.
Certificate of Deposit is a
written promise by a bank to
repay the depositor, usually with
interest. Individual CDs start as
low as $100 while institutional
CDs start at $100,000. Maturities
range from a few weeks to many
years. Interest rates are
competitive in the market.
Money Market is investment in
short-term debt securities that
can be quickly turned into
spendable cash. Compare to
Capital Market.
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Money
Market Fund is an open-ended
Mutual Fund that invests banker's
acceptances, CDs, commercial
paper, government securities,
repurchase agreements and other
liquid and safe securities. The
fund pays money market rates of
interest, which raises and lowers
while the fund's net asset value
remains $1 per share.
Mutual Fund involves an
investment company collecting
money from shareholders to invest
the money in stocks, bonds,
options, commodities and/or money
market securities. A small
management fee is charged to the
stockholder while the fund offers
the advantage of diversity and
professional management.
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