What are They

Cash investments refer to financial instruments or assets that are easily converted into cash with minimal risk of loss. These investments are typically short-term and provide stability and liquidity to investors.

Certificate of Deposits

CDs, or Certificates of Deposit, are time deposits offered by banks and credit unions. They are financial instruments that allow individuals to deposit a fixed amount of money for a specified period, typically ranging from a few months to several years. CDs offer a predetermined interest rate that is usually higher than what traditional savings accounts provide. Here are some key features of CDs:

Fixed Term:

CDs have a fixed maturity or term, meaning that the funds are locked in for a specific period agreed upon at the time of purchase.

Interest Rates:

CDs offer a fixed interest rate, which is typically higher than regular savings accounts. The rate is agreed upon at the start and remains constant throughout the term of the CD.

Penalties for Early Withdrawal:

If you withdraw funds from a CD before its maturity date, you may incur a penalty, which can vary depending on the financial institution and the terms of the CD.

FDIC Insurance:

CDs offered by banks are often insured by the Federal Deposit Insurance Corporation (FDIC) up to certain limits, providing protection against bank failure.

CDs are considered a low-risk investment option, particularly when offered by reputable financial institutions. They provide stability and predictable returns over a defined period. Due to their fixed terms, CDs are suitable for individuals who have a specific time frame in mind for their investment and do not require immediate access to the funds.

Before investing in a CD, it's essential to carefully consider the terms, including the interest rate, maturity period, and any penalties associated with early withdrawal. Compare rates among different banks or credit unions to ensure you're getting the best possible return on your investment.

Money Market Accounts

Money market accounts (MMAs) are a type of deposit account offered by banks and credit unions. They share similarities with both savings accounts and checking accounts. MMAs typically offer a higher interest rate than regular savings accounts while providing some check-writing or debit card capabilities. Here are some key features of money market accounts:

Interest Rates:

MMAs typically offer higher interest rates compared to traditional savings accounts. However, the rates are variable and can fluctuate based on market conditions.

Limited Transactions:

Money market accounts often have restrictions on the number of transactions you can make per month. These limitations aim to maintain the account's status as a short-term investment vehicle and not a primary transactional account.

Minimum Balance Requirements:

Many MMAs require a minimum balance to open the account and may have ongoing balance requirements. If the balance falls below the specified minimum, the account holder may be subject to fees or a lower interest rate.

Check-Writing and Debit Card Access:

Unlike regular savings accounts, MMAs may provide the ability to write checks or make debit card transactions. However, the number of checks or transactions may be limited per month.

FDIC Insurance:

Money market accounts offered by banks are often insured by the Federal Deposit Insurance Corporation (FDIC) up to certain limits, providing protection against bank failure.

MMAs offer a balance between earning interest on deposited funds and maintaining access to liquidity. They are suitable for individuals looking for a short-term investment option with higher interest rates than traditional savings accounts while still having the flexibility to make limited transactions.

It's important to compare the terms and conditions of MMAs offered by different financial institutions, including minimum balance requirements, transaction limitations, and fees, to find the one that aligns with your financial goals and needs.

treasury bills

Treasury Bills

Treasury bills, often referred to as T-Bills, are short-term debt securities issued by governments, specifically the U.S. government in the case of U.S. Treasury bills. T-Bills are typically considered one of the safest investments available in the market due to the backing of the government. Here are some key features of Treasury bills:

Issued by the Government:

T-Bills are issued by the U.S. Department of the Treasury to finance the government's short-term funding needs. Other countries may have similar instruments issued by their respective governments.

Maturity Periods:

Treasury bills have short-term maturity periods that can range from a few days to one year. They are typically issued with maturities of 4 weeks (28 days), 13 weeks (91 days), 26 weeks (182 days), or 52 weeks (364 days).

Sold at a Discount:

T-Bills are sold at a discount from their face value. Investors purchase T-Bills at a price below the face value and receive the full face value amount at maturity. The difference between the purchase price and the face value represents the interest earned.

No Coupon Payments:

Unlike other types of bonds, T-Bills do not pay regular coupon or interest payments during their term. Instead, the interest is earned through the difference between the purchase price and the face value at maturity.

Highly Liquid:

T-Bills are highly liquid investments, meaning they can be easily bought or sold in the secondary market before their maturity date. They are often traded in large denominations, but smaller investors can access them through Treasury Direct or brokerage accounts.

Low Risk:

T-Bills are considered low-risk investments due to the backing of the government. The U.S. Treasury has a strong credit rating, making T-Bills among the least risky investments available.

Investors often choose Treasury bills as a safe haven investment or as a component of their portfolio to preserve capital and earn a modest return with minimal risk. They are particularly suitable for individuals looking for short-term investments or a place to park funds temporarily.

When investing in Treasury bills, it's essential to consider the current interest rates, the length of the investment term, and any applicable taxes. The U.S. Treasury provides regular auctions for T-Bills, and interested investors can participate directly or through brokerage firms.

Money Market Funds

Money market funds are a type of mutual fund that invests in short-term debt securities, such as Treasury bills, commercial paper, certificates of deposit, and other highly liquid and low-risk instruments. These funds aim to provide investors with a stable value and a modest rate of return while maintaining liquidity and capital preservation. Here are some key characteristics of money market funds:


Money market funds focus on capital preservation and liquidity. They aim to maintain a stable net asset value (NAV) of $1 per share, meaning the value of each share should remain relatively constant.

Short-Term Investments:

Money market funds primarily invest in short-term debt securities with maturities typically less than one year. These investments are considered to have a lower level of risk compared to longer-term bonds or equities.


Money market funds diversify their holdings across various issuers, such as governments, municipalities, and corporations, to spread risk. This diversification helps to mitigate the impact of default by a single issuer.

Professional Management:

Money market funds are managed by professional investment managers who make decisions on the fund's asset allocation, security selection, and liquidity management. Their goal is to maintain stability and maximize yield within the framework of preserving capital.


Money market funds provide investors with easy access to their funds. Typically, investors can redeem their shares at any time, allowing for quick and convenient withdrawals.


Money market funds aim to provide a competitive yield, but returns are generally lower than those of longer-term investments, such as stocks or longer-term bonds. The yield is influenced by prevailing interest rates and the credit quality of the underlying investments.

Regulatory Oversight:

Money market funds are subject to regulations and oversight by regulatory bodies like the Securities and Exchange Commission (SEC) in the United States. These regulations focus on maintaining stability, liquidity, and transparency.

Money market funds are often utilized by investors seeking a relatively safe place to park their cash, earn a modest return, and have quick access to funds when needed. They are commonly used for short-term savings, emergency funds, or as a temporary holding place for funds awaiting investment in other assets.

It's important to note that while money market funds are generally considered low-risk, they are not guaranteed by the government, unlike deposit accounts like savings accounts or certificates of deposit. Investors should carefully review the fund's prospectus, expenses, investment objectives, and risks before investing in a specific money market fund.

Short Term Bond Funds

Short-term bond funds are mutual funds or exchange-traded funds (ETFs) that primarily invest in fixed-income securities with relatively short maturities. These funds aim to provide investors with income generation and capital preservation while maintaining lower interest rate risk compared to longer-term bond funds. Here are some key features of short-term bond funds:

Investment in Short-Term Bonds:

Short-term bond funds invest in fixed-income securities, such as government bonds, corporate bonds, municipal bonds, and other debt instruments, with relatively short durations. The exact definition of "short-term" can vary among fund managers but generally refers to maturities of around one to five years.

Income Generation:

Short-term bond funds aim to generate income for investors through interest payments received from the underlying bond holdings. The yield is typically higher than that of money market funds or cash investments, although it may be lower than longer-term bond funds.

Lower Interest Rate Risk:

Compared to longer-term bonds, short-term bonds are generally less sensitive to changes in interest rates. This means that short-term bond funds may experience smaller fluctuations in value when interest rates rise or fall.


Short-term bond funds typically diversify their holdings across various issuers, sectors, and credit qualities to spread risk. This diversification helps to mitigate the impact of default by a single issuer.

Professional Management:

Short-term bond funds are managed by professional portfolio managers who make decisions regarding the fund's asset allocation, bond selection, and overall strategy. Their goal is to achieve a balance between generating income and managing risk.


Short-term bond funds offer liquidity to investors, allowing them to buy or sell shares on any business day at the fund's current net asset value (NAV). This provides flexibility and access to funds when needed, though there may be costs associated with buying or selling shares.

Credit Risk:

While short-term bond funds generally invest in high-quality bonds, they can still have exposure to credit risk. Lower-rated bonds or those from issuers with weaker credit profiles may offer higher yields but also carry a higher risk of default.

Short-term bond funds can be suitable for investors seeking a balance between income generation and capital preservation. They are often used as alternatives to longer-term bond funds or as components of a diversified investment portfolio.

As with any investment, it's important to carefully review the prospectus, investment objectives, expenses, risks, and historical performance of a short-term bond fund before making an investment decision. It may also be beneficial to consider consulting with a financial advisor to ensure the investment aligns with your specific goals and risk tolerance.

High Yield Savings Account

A high yield savings account, also known as a high-interest savings account, is a type of savings account that offers a higher interest rate compared to traditional savings accounts. These accounts are typically offered by online banks or financial institutions that specialize in providing competitive interest rates on deposits. Here are some key features of high yield savings accounts:

Higher Interest Rates:

The primary attraction of high yield savings accounts is the higher interest rates they offer. These rates are generally higher than those offered by traditional brick-and-mortar banks and are designed to provide a better return on your savings.

FDIC Insurance:

High yield savings accounts provided by FDIC-member banks are typically insured by the Federal Deposit Insurance Corporation (FDIC). This insurance covers deposits up to certain limits, providing protection against bank failure.

Easy Access to Funds:

Like regular savings accounts, high yield savings accounts provide easy access to your funds. You can make withdrawals or transfers as needed, though there may be limits on the number of transactions allowed per month.

Minimum Balance Requirements:

Some high yield savings accounts may have minimum balance requirements to earn the advertised high interest rate. It's important to review the account terms to understand any specific requirements.

Online Banking:

High yield savings accounts are often offered by online banks or financial institutions, meaning that account management and transactions are primarily conducted online or through mobile banking apps. This allows for convenience and flexibility in managing your account.

Competitive Rates, But Not Risk-Free:

While high yield savings accounts offer attractive interest rates, it's important to remember that they are not risk-free. As with any savings account, the primary risk is the potential erosion of purchasing power due to inflation. Additionally, there may be risks associated with the financial institution offering the account, so it's important to choose a reputable and well-established institution.

High yield savings accounts can be beneficial for individuals looking to earn a better return on their savings compared to traditional savings accounts. They are often favored by those seeking a balance between liquidity and higher interest rates while maintaining the safety and security of their deposits.

When considering a high yield savings account, it's important to review the terms and conditions, including interest rates, fees, minimum balance requirements, and any limitations on transactions. Comparing offerings from different banks can help you find the best high yield savings account to suit your financial goals and needs.

Commercial Paper

Commercial paper refers to a short-term debt instrument issued by corporations, financial institutions, and other creditworthy entities to meet their short-term funding needs. It is typically an unsecured promissory note with a fixed maturity period, usually ranging from a few days to 270 days (less than a year). Here are some key features of commercial paper:


Commercial paper is typically issued by large, creditworthy corporations and financial institutions. These can include companies in various industries, such as manufacturing, finance, and technology.


The primary purpose of commercial paper is to provide short-term financing for the issuer's operational needs, such as funding inventory, managing cash flow, or meeting immediate liabilities. It allows these entities to raise funds quickly and at a relatively low cost.


Commercial paper has a relatively short maturity period, generally ranging from a few days to 270 days. The specific maturity is determined by the issuer and is stated on the face of the instrument.

Unsecured and Fixed Interest:

Commercial paper is typically unsecured, meaning there is no collateral backing it. It relies on the creditworthiness of the issuer. It is also issued at a discount to its face value, and the interest is the difference between the discounted price and the face value.

High Credit Quality:

Commercial paper is generally considered to have a high credit quality because it is issued by reputable and financially stable entities. Credit rating agencies assess the creditworthiness of the issuers and assign ratings based on their evaluation.

Trading in Secondary Market:

Commercial paper can be traded in the secondary market before its maturity date. Financial institutions, money market funds, and other institutional investors often participate in this market to buy and sell commercial paper.


Commercial paper is subject to regulation in many countries. In the United States, for example, commercial paper offerings must comply with regulations set by the Securities and Exchange Commission (SEC).

Investing in commercial paper is typically limited to institutional investors due to the large denominations and the minimum investment requirements. Individual investors can indirectly access commercial paper through money market funds that hold these instruments.

It's important to note that while commercial paper is generally considered to be low-risk, there is still some level of risk associated with the creditworthiness of the issuer. Before investing in commercial paper, investors should carefully evaluate the credit quality of the issuer, assess the prevailing market conditions, and consider their risk tolerance and investment objectives.