I just discovered the EverBank MarketSafe Diversified Metals Certificate of Deposit (CD), and thought it was a unique enough offering to give it a highlight here (I’m strongly considering it myself). For the risk averse who aren’t satisfied with paltry 2.86% average yield on 5 year CD’s (and less on checking accounts/money markets) but aren’t brave enough for a volatile stock market, this might be an option worth taking a look at.
Since it’s a unique product, I thought it would be best to cover the questions that I had about it and provide the researched answers I found. Note that you only have until May 13 to fund your account if you are interested.
What is the EverBank Diversified Metals CD?
It is a 5-year CD that takes the spot price of gold, silver, and platinum and offers a potential 50% upside (plus the initial deposit), with a 100% principal deposit protection (meaning that your won’t lose money if the value of those commodities goes down).
What is the Term for the CD?
- 5-years. You can withdraw your funds early – it is a 5-year commitment.
What is the Minimum Deposit?
- $1,500
Is it FDIC insured?
- Yes
Any Fees?
- No
How does EverBank figure out the Return?
Is there a Downside? Only the Opportunity Cost of Having your Money Elsewhere
- Well, technically, no, if you were in cash the entire time. If you were in the stock market, your return would be unknown – and nobody knows where the stock market will be in 5 years. If you were in a CD over a 5 year period that earned 2.86%, your compound return would be approximately 15% on top of your original deposit.
Would you Give it a Shot?
- Whether or not you put your money into this EverBank offering, I think it begs a discussion about where you will be putting your money over the next 5 years?
- Do you think the market run-up will continue over the next 5 years and exceed a 50% return?
- Do you think commodity prices will continue to grow?
- Have you had an experience with a unique bank product like this before?
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