Short-term investments are financial instruments that are designed to be held for a relatively brief period, typically from a few days up to five years.
Short-term investments are highly liquid, meaning you can easily convert them into cash when you need the funds.
Pros: Safe, guaranteed returns, FDIC-insured (US).
Cons: Early withdrawal penalties, potentially lower returns than other options when interest rates are low.
Pros: Potential for slightly higher returns than CDs, varying levels of risk depending on the issuer (government vs. corporate bonds).
Cons: Some market risk depending on issuer’s creditworthiness, interest rate sensitivity.
Pros: Relatively safe, higher interest than traditional savings, often check-writing privileges.
Cons: Returns slightly lower than some other options, limited transactions per month.
Pros: Highly liquid, aim to preserve capital value, diversify risk across short-term debt instruments.
Cons: Not FDIC-insured, returns can fluctuate slightly.
Pros: Very low risk (focused on government debt), potential for slightly higher returns than individual T-bills.
Cons: Minimal market risk, interest rate risk.
Pros: FDIC-insured, easy access, better returns than traditional savings accounts.
Cons: Interest rates can fluctuate, still lower returns than some other short-term options.
Pros: Potentially very high returns.
Cons: Significant borrower default risk, lack of regulation and insurance in some platforms.
Pros: Diversification across a basket of short-term assets, liquidity through exchanges.
Cons: Some level of market risk, management fees.
Always research thoroughly and consult a financial advisor before investing.