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If you want to invest for one year or less, I recommend you use money market tools. These tools include two types, traditional tools, and non-traditional tools.
The fixed-income securities of this type issued by the US Treasury Bills are called traditional money market instruments.And because they are trusted by the US government, they have become a highly secure investment tool. If you want to know the US treasury bills, you can read the relevant materials.
An investor's loan to a savings bank or bank is called an insured certificate of deposit - insured CD and its duration are generally between 90 days and ten years. The first deposit of $100000 that investors make in most banks is usually insured by the Federal Deposit Insurance Corporation. Many securities dealers establish a secondary market on certificates of deposit. Similarly, if you want to learn more about the techniques of this method, please read the introduction to CD.
The following is an introduction to transferable deposit certificates. Transferable deposit certificates are US $5 million large amount certificates issued by the largest and safest bank. They are sold only to large institutional investors, such as the money fund market. Like insurance CDs, only the first 100000 are insured.
Next, we will use a case to explain what is called a bank acceptance bill. Now there is a cross-border trading company. In order to complete cross-border trade activities, it borrowed $98000 from the bank, promised the bank to repay the bank's principal plus interest within three months, totaling $100000, and signed a contract similar to a check as a guarantee. The receivables of this contract are the assets of the bank, which can choose how to deal with them freely. For example, continue to hold or choose to sell. However, it is worth noting here that if the bank wants to sell it, it must first ensure that the buyer who bought the contract believes in the contract, so the bank will ensure the credit quality of the assets to do this. It is signed "Accepted" on the back of the contract and stamped with the seal of the government official. So this note can be traded according to your trust in the bank rather than another company where you do not know the risks. This transaction is characterized by its suitability for short-term loans.
There is also a short-term transaction called commercial paper, which is characterized by investors providing short-term unsecured loans to companies. The maturity of most commercial bills is very short, ranging from one month to three months, and the maximum is not more than nine months. They are sold to investors at a discount to the face value and then redeemed by investors at face value.
Finally, I will introduce an agreement called a repurchase agreement, which is a very short-term guaranteed loan used by securities traders to finance their fixed-income inventory. Only qualified investors can issue this type of loan, and these investors can hold the collateral for financing. The characteristic of this type is that if the dealer does not repay the loan, the investor can sell the mortgage. The shortest period can be overnight, and the longer period lasts from two days to the thirtieth day. The amount usually exceeds one million dollars.
(Writer:Galli)