Q.
What is a Market-Linked CD?
A.
A Market-Linked CD (MLCD) is a type of CD that earns a return based on the performance of its underlying index. Your principal is 100% protected against losses when held to maturity.

Principal protection with market returns

Calculate potential returns when comparing a Market-Linked CD to a traditional Bank CD, by setting an initial deposit amount and projecting a Market-Linked CD’s annualized rate of return.

Amount
$10,000
$1,000$250,000
Annualized Return after 5 years
8.2%
S&P 500*
NASDAQ*
-20%0%20%
*S&P 500 and NASDAQ 5-year historical annualized returns (as of 9/5/19) are displayed for reference purposes only. Bank CD 5-year APY as stated by FDIC (as of 9/2/19).
$14,557
Potential MLCD Payout • After 5 years
*S&P 500 and NASDAQ 5-year historical annualized returns (as of 9/5/19) are displayed for reference purposes only. Bank CD 5-year APY as stated by FDIC (as of 9/2/19).

What can MLCDs do for you?

Find growth potential

With Market-Linked CDs it’s possible to increase the opportunity of seeing greater returns. MLCDs are designed to provide investors with the ability to participate in the performance of the underlying index, while retaining certain characteristics of a traditional CD.

Limit downside risk

If the performance of the underlying index of an MLCD drops the principal investment is protected. It is important to highlight that Market-Linked CDs only guarantee principal back at maturity and thus if an investor sells or redeems their investment prior to maturity, they may receive a return of less than their original investment.

Protect assets

In addition to principal protection, MLCDs offer the safety of an FDIC-insured CD. MLCDs carry insurance protection, subject to limitations, including FDIC coverage up to $250,000 per account title. Please refer here for more information regarding FDIC insurance and limits.

Frequently Asked Questions

  • What is the payout?

    At maturity, investors receive the full initial investment plus an additional amount based on the return of the underlier. Please read the offering circular on each offering before participating.

  • What are the risks?

    MLCDs may not be a suitable investment for all investors. Risks include liquidity risk, market risk, credit risk, and performance risk. Please read the offering circular on each offering before participating.

  • What is the term length?

    A CD term length is the length of time your principal is invested in the MLCD between trade date and maturity date. MLCDs guarantee the return of the principal only if held until maturity.

Learn More

Find out more about MLCDs at Motif

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