Offbeat Offerings: Brokered Certificates of Deposit
by Cara Scatizzi
Most investors have, at one time or another, parked a sum of money in a bank certificate of deposit (CD). A typical bank CD bears a maturity date, a specified interest rate, and is insured for sums up to $100,000 if the issuing bank is insured by the Federal Deposit Insurance Corporation (FDIC).
Traditionally, individual investors have purchased bank CDs through local banks. But in todays market, individual investors increasingly have access to brokered CDs, which are CDs issued by a bank and sold through a brokerage firm. The allure of these brokered CDs is the possibility of higher rates compared to a traditional CD purchased through a local bank.
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