MONEY MARKET CERTIFICATE Definition

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MONEY MARKET CERTIFICATE is a security issued by com­mercial banks and savings and loan associations. Money market certificates pay a yield often based on the going Treasury bill rate. Interest rates on certificates normally remain fixed over their maturity and investors face an interest penalty for early withdrawal.

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CASH SETTLEMENT, in short-term securities, is payment and delivery made on the same day as the trade date.

SUBORDINATED DEBENTURE, in securities, is a debt issue whose claim on assets is subordinated to that of general creditors in the event of a liquidation, as stated in the bond indenture.

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