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The Perfect Portfolio For Those Who Hate To Lose Money

FYI: My mother-in-law loves to buy Certificates of Deposit (CDs). “When I die,” she says, “you’ll be shocked to see how many I own.” Every couple of months, she calls up her neighborhood banks. She looks for the bank with the best CD interest rate. When she finds it, she grabs her checkbook, climbs into her car and races to the bank. Her Audi needs a bumper sticker that reads, “I speed for CDs”


  • So now we know how you got your mojo Ted. Very funny.
  • I am a cautious/nervous investor too, given what I view as mass complacency and rich valuations across equities and debt-instruments. At this point in both the investing cycle, and my own investing life-cycle, I am far more interested in not losing, than taking risk. I am convinced stocks/bonds will be able to be had at better prices at some point in the future. When will this happen and why? Time will solve that mystery.

    As for CDs, an anecdote: I do business with 2 banks, an internet bank and a national brick/mortar bank. I've noticed that CD rates offered at both these banks are lower than CDs offerred by the very same banks, but purchased through my broker (Fido). To emphasize: your bank may be 'scr#wing you' if you are loyal (lazy-) enough to buy the CDs from them directly. You actually can earn (slightly) more by utilizing a middle-man (the broker). I've only recently (past 2 months or so) began considering using CDs, as short-term rates have moved (however slightly) over 0%.

    I've decided to forego using CDs though, in favor of just initiating a Treasury-bill ladder, buying the bills at auction for $0 commission. The ladder goes out 26 weeks; with the "rungs" of the ladder spread 2 or 3 weeks apart. Purchasing 2 year (or longer) notes/bonds doesn't seem worthwhile, given the current shallowness of the yield curve. As formerly-purchased bills mature, I just roll them proceeds out at the next 26 week auction.
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