Fixed deposit
Market basicsAlso called: FD
A bank deposit paying a contracted rate over a fixed term.
In plain terms
Excellent for money needed in eighteen months, poor for money needed in eighteen years.
1492 terms
Glossary
Every term is defined twice: once the way a filing would put it, and once the way somebody would explain it to you across a table. The second one is usually the one that sticks.
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Corporate FD
Market basicsA fixed deposit with a company rather than a bank.
In plain terms
One to two percent more, and no deposit insurance. The extra is the price of credit risk.
Sweep-in FD
Market basicsA fixed deposit linked to a savings account that automatically converts back to cash when the balance runs short.
In plain terms
Earns deposit interest while behaving like a savings account. The natural home for an emergency fund.
Inflation
Market basicsThe rate at which the general price level rises, reducing what a given sum of rupees can buy.
In plain terms
The risk a fixed deposit does not remove. The statement balance only ever rises, which is exactly why thirty years of erosion goes unnoticed.
InvIT
Market basicsAlso called: Infrastructure Investment Trust
Infrastructure Investment Trust — a listed trust owning operating infrastructure such as roads, transmission lines or pipelines, distributing the income they produce.
In plain terms
Its headline yield is not comparable to a fixed deposit. A concession has a finite life, so part of that generous distribution is your own capital coming back.