Bear CD
A bear CD is a weird flavor of a normal CD, or Certificate of Deposit.
Remember that the big buyers of normal CDs are grannies, grampsies, and Nelly Nervouses all around the world who just sleep better, taking no stock market risk.
CDs are extremely safe instruments and, generally speaking, essentially never have problems. That is, they pay off in full and on time, and we're guessing that your odds of being killed by a car crossing the street after you've gulped your double macchiatto from SBUX are higher. But in the case of a Bear CD, the interest it pays is pegged in a G-rated way to a market index. That is, the Bear CD might pay 2.5% annually while pegged to NASDAQ at 8,000. But for each 100 points that NASDAQ goes up, the rate of the Bear CD declines by, say, 5 basis points. So if NASDAQ went up to 8,100, the new rate, likely adjusted monthly or quarterly, would then become 2.45%.
Bear CDs are kind of a hedge against equity movements, all designed to make Nelly...less nervous.
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Finance: What's the Difference Between B...159 Views
Finance a la shmoop what's the difference between bear and bull? bear
pessimistic bad growly things coming Negative Nancy boo bear...Bull [Bear walking into water]
awesomesauce life's good you take it by the you know horns alright we're gonna
apply bear and bull to markets here but they apply to a whole lot of things and
a bear market is actually technical nomenclature that refers to sustained or [Bear market definition on 100 dollar bill]
prolonged periods of time where stock prices generally just fall...three
four five six seven eight quarters where the market craps the bed down down down
the bear market pattern is different from just a correction when the market
takes just a short term dump and then well you know quickly recovers yeah like [Bear market graph]
it has a bad quarter or two and then starts climbing again well that's not
the big bad bear that's just a correction a bull market is just the
opposite it goes up up up like this guy in his balloon-powered house and that's [House with balloons travels up a stock value graph]
it both are dangerous in the wild but on Wall Street huh you just have to watch
out for the Bears [Bear chasing a woman]
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