Should I hold the CD or sell it now? All advice appreciated.At this point, I'd just hold it. In two years, you'll have the $1000 face value of the CD plus another $75 in interest (plus a small additional amount for the compounding of the first year's interest, which I'll just ignore for now). So that's $1075 in two years with the CD.Based on the current $880 value, you would need to get about 10.5% from an alternative investment over the next two years to get you back to your guaranteed $1075 in two years with the CD. The current $880 value times 1.105^2 is roughly $1075. You seem to imply that your alternative investment would be expected to give you between 8% and 15%. So I guess it's really your risk profile that's going to make the decision. Do you want a guaranteed $1075 in two years? Or do you want something that's expected to get between 8% ($1026 in two years) and 15% ($1164 in two years), but also has the distinct possibility of being more or less than that range?For me, I'll take the guaranteed return. But I freely admit that I'm a bit risk averse. And I really don't know anything about that fund. So that's coloring my opinion a bit as well.--Peter
Best Of |
Favorites & Replies |
Start a New Board |
My Fool |
BATS data provided in real-time. NYSE, NASDAQ and NYSEMKT data delayed 15 minutes.
Real-Time prices provided by BATS. Market data provided by Interactive Data.
Company fundamental data provided by Morningstar. Earnings Estimates, Analyst Ra