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.
Related or Semi-related Video
Finance: What is a Bear Raid?8 Views
Finance allah shmoop what is a bear raid So this
is a bear raid and this is a bear raid
And you knew you were going there Well i think
there's fraud fraud i tell you Well i think their
product just doesn't mean anything anymore Well i think that
with all those risk they're just trade me in it
too high a multiple Isn't the government going to regulate
them I thought that was a union coming in there
What are these people doing Are they rationally commenting on
honest things they actually believe are elements of the stock
No not at all In fact all of them shorted
the stock it's sixty bucks a share making the bet
that the stock would go down only now courtesy of
the wall street genius journalists being manipulated at the new
socialist times the group is spreading lies trickery and deceit
about stock prices Manipulating the market hoping to profit from
all the negative sentiment they've poured out there into the
ether making already nervous investors very nervous And it was
easy to get the journalist cooperate because well they hate
rich people Right All right Well if they covered it
thirty five that is unwound They're short position which started
at sixty bucks a share Well they'd have made twenty
five dollars a share in profits and that's totally illegal
Incidentally so is the other kind of bear raid but 00:01:29.315 --> [endTime] that we're not going there today Oh my
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