Investment
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Many potential investors feel CD's are safe investments as well. Certificates of Deposit (CD's) offers varying interest rates based on a certain time period of investment. Inflation could certainly represent an impact to purchasing power and impact the return of your investment although probably minimal given a short-time period. An additional risk involves penalty fees (i.e. early withdrawal, etc.) which can erode your promised return significantly.
Is there such a thing as guaranteed returns? Can banks guarantee investors a certain return without any risk?
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Solution Summary
Solution discusses whether or not a bank can guarantee returns.
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To answer your question, first you need to know that return is always associated with risk. The greater the return, the greater the risk.
But why do people say "risk-free assets"? This is only a ...
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