3verysafeinsuredbythegovernment ussavingsbonds

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Unformatted text preview: deposit accounts 1) Account at commercial bank or similar institution 2) Similar to savings accounts but can make a limited number of payments by check. 3) Very safe; insured by the government US savings bonds 1) Debt issued by the US government 2) Cannot be sold or transferred to others 3) Designed for small investors Treasury Bills 1) Debt issued by US government 2) Issued at discount to face value 3) Very safe asset 4)Short maturity Negotiable certificates of deposit 1) Issued by a bank in exchange for deposit of funds. 2)Fixed maturity 3) Can be sold in the open market before maturity. TIPS 1) Treasury Inflation‐Protected Security 2) Designed to protect investors against unexpected Government agency securities Repurchase agreements Bankers acceptances Commercial paper Money market securities Why do investors hold money market securities? What is the purpose of the capital market? Fixed‐Income Security Bond Par value (face value) Maturity (bond) Coupon (bond) Discount (bond) Premium (bond) Callable (bond) Zero‐coupon bond Major Types of Domestic Bonds inflation 3) Principal is adjusted for inflation so you will earn more (in dollars) if i...
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