UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev Thread | Next Thread
Author: ferjen Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 24253  
Subject: Premier Notes Date: 5/9/2012 12:24 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 1
http://www.duke-energy.com/investors/individual-investors/pr...

This is a vehicle by Duke Energy. It's really a means to invest in their debt. The ad in the local paper touts 1.61% APY. Since its a debt investment, it is not FDIC insured. But, it's an account with a lot of bank account similarities including free check writing above $250 and electronic transfers. Minimum balance is $1000 and no writing checks at the Walmart checkout to buy groceries. But, I suspect anyone interested in this would be looking for a place to store cash and receive a decent rate by today's standards.
Print the post Back To Top
Author: joelcorley Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 24186 of 24253
Subject: Re: Premier Notes Date: 5/10/2012 11:40 AM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 1
ferjen,

You wrote, http://www.duke-energy.com/investors/individual-investors/pr...

This is a vehicle by Duke Energy. It's really a means to invest in their debt. The ad in the local paper touts 1.61% APY. Since its a debt investment, it is not FDIC insured. But, it's an account with a lot of bank account similarities including free check writing above $250 and electronic transfers. Minimum balance is $1000 and no writing checks at the Walmart checkout to buy groceries. But, I suspect anyone interested in this would be looking for a place to store cash and receive a decent rate by today's standards.


I wonder if this discussion shouldn't be over on the Bond and Fixed Income board. Of course you're likely to get Charlie ranting about how this doesn't give you a real rate of return, but there are some people over there willing to have a rational discussion about very liquid and/or very short-term instruments.

However I will say that I wouldn't touch this product. I'd much rather stick my money in a 5 year Ally CD, which is currently paying 1.69% APY. Even if you don't hold for the money for that long, the penalty is only 60 day's worth of interest - or about 0.281% of the deposit. So even if you hold for only a year, you'll still get more than 1.4% APY. There are no deposit minimums for that and you're FDIC insured.

- Joel

Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post Back To Top
Author: aj485 Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 24187 of 24253
Subject: Re: Premier Notes Date: 5/10/2012 12:16 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 4
This is a vehicle by Duke Energy. It's really a means to invest in their debt. The ad in the local paper touts 1.61% APY. Since its a debt investment, it is not FDIC insured. But, it's an account with a lot of bank account similarities including free check writing above $250 and electronic transfers. Minimum balance is $1000 and no writing checks at the Walmart checkout to buy groceries. But, I suspect anyone interested in this would be looking for a place to store cash and receive a decent rate by today's standards.

This looks to me like a lawsuit waiting to happen.

Anyone remember the Auction Rate Securities debacle? Auction rate securies were marketed as a 'safe and liquid' place to earn a higher rate on your money, as you could always get your money back out at the next auction (generally 7 days) if you needed it. And it worked, until it didn't.

And money market funds that broke the buck?

Both generated lots of lawsuits.

Disclose all you want, if it's being marketed as a liquid account that checks can be written on, people are not going to accept it if there is EVER a loss, so there will be lawsuits if that occurs.

AJ

Print the post Back To Top
UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev Thread | Next Thread
Advertisement