Let's say there are short term CD's that their duration is only one month with the rate of %2. I can buy equivalent of 100k and I'll have 102k after one month. Immidiately after expiration I buy the same CD or another 2% with 102k and I can do that for a whole year, and get the my princioal with compounded interest: 100k * (1.02)^12 = 126.8k, which is %26.8 profit. It seems too good to me! Are there any restrictions against this in brokerage accounts like vanguard, like there are limitations on the number of time you can buy, etc? Am I missing anything? TC 265 YOE 2
Let me know where you find a CD that pays 2% a month lmfao. I just got one that pays 2.6% pa
What is PA?
Per annum
Lol.
Then what does vanguard's 1 month 2.2% mean?
All percentages of interest rates are annual.
It is the nature of a genius to doubt the obvious.
U deserve to be at MSFT
In my defence, vanguard's interface and speccially this product description is very confusing to a beginner to investing.
How did you pass interviews
1 month = 2.2% APY
For a 1-month duration CD, they should put the monthly yield.
Monthly yield , bimonthly yield, quarterly yield, half yearly yield, etc can get quickly to many variants of similar units making it difficult to compare products, that’s why everything is APY including credit card interest rate
Other than buying CDs, no
embarrassing. leave your money under your bed.
I'm guessing the problem is finding a CD with a 2% per month rate. It's probably 2% annualized but you'll get 2%/12 (give or take).
Also factor in the taxes on gains