Variable-rate CDs

Variable-rate CDs

Short-term certificate of deposits that pay interest periodically on roll dates. On each roll date, the coupon on the CD is adjusted to reflect current market rates.

Variable-Rate Certificate of Deposit

A certificate of deposit for which the interest rate changes according to some formula at set intervals. Investors use variable-rate certificates of deposit when they want a low-risk investment but expect prevailing interest rates to rise during the life of the CD. See also: Variable-rate bond.
References in periodicals archive ?
Some banks are experimenting again with hybrid, variable-rate CDs that are tied to an index, such as Standard & Poors, Nasdaq, certain foreign markets or particular domestic stock sectors.
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