Many investors seek a combination of safety, return, and liquidity for at least a portion of their investments or savings. Despite the challenges of today’s low interest rate environment, new issue brokered CDs and new issue corporate notes are two products that provide individual investors fixed income investments that are simple to understand and easy to access. In this recorded webinar, Fidelity fixed-income professionals Dan Fiandaca and Richard Carter discussed the similarities and differences between these two products and why certain issuers participate in either or both markets. Also, see how investors can easily use the resources available on Fidelity.com — and now for CDs, the Fidelity Mobile app — to assess the relative risks and potential rewards of an offering before they invest.
Any fixed income security sold or redeemed prior to maturity may be subject to a substantial gain or loss. Your ability to sell a CD on the secondary market is subject to market conditions. If your CD has a step rate, the interest rate may be higher or lower than prevailing market rates. The initial rate on a step-rate CD is not the yield to maturity. If your CD has a call provision, which many step-rate CDs do, the decision to call the CD is at the issuer's sole discretion. Also, if the issuer calls the CD, you may obtain a less favorable interest rate upon reinvestment of your funds. Fidelity makes no judgment as to the creditworthiness of the issuing institution.
Investing in bonds involves risk, including interest rate risk, inflation risk, credit and default risk, call risk, and liquidity risk.