promotion image of download ymail app
Promoted
seed asked in Business & FinanceInvesting · 1 decade ago

What is an Interim Interest Rate?

I'm looking to buy these stock indexed GICs from the bank, but it says there is an "Interim Interest Rate" of 3.25%. I was wondering if this means i lose 3.25% of the money i invest or do I gain it or...?

4 Answers

Relevance
  • 1 decade ago
    Favorite Answer

    Typically with a gic you are guarenteed and interest rate for a set period of time. Usually 3 months. They are quoting you the interest rate you will earn. By the way that is usually an annualized number meaning you most likely are earning 1/4 of that interest rate for the 3 months. Talk to a professional about spreading your self into the different types of mutual funds they offer in your plan. Oh, you wouldn't lose $ in a GIC usually the safest investment choice. I just reread your question. If it's a stock index linked GIC you will get a portion of the performance of the market included with the fixed rate. Sounds like and index linked CD or and INDEX linked Annuity. Check out this link for some good info on those http://www.guardingyourwealth.com/annuities/articl...

    • Commenter avatarLogin to reply the answers
  • Lynn
    Lv 4
    4 years ago

    For the best answers, search on this site https://shorturl.im/axgUt

    You do get a return, it's just that if someone had the choice of buying your bond or a new one with the higher interest rate, the only way your bond would sell is if you cut it's price so that the overall yield is the same or better. It's still a better return than just holding onto money as you've would've redeemed a few interest coupons in the interim. Remember, you don't have to sell it either, you could just hold on till maturity and redeem for the full face value. What you're seeing is the time value and opportunity value of money. You buy the bond now cause the higher interest bond later isn't available yet. You don't actually lose money, you lose money in comparison to other opportunities but you have to remember those other opportunities aren't till later. You just have to consider how best to benefit from those other opportunities when they do arrive.

    • Commenter avatarLogin to reply the answers
  • 5 years ago

    This Site Might Help You.

    RE:

    What is an Interim Interest Rate?

    I'm looking to buy these stock indexed GICs from the bank, but it says there is an "Interim Interest Rate" of 3.25%. I was wondering if this means i lose 3.25% of the money i invest or do I gain it or...?

    Source(s): interim interest rate: https://shortly.im/hltvM
    • Commenter avatarLogin to reply the answers
  • kathe
    Lv 4
    4 years ago

    I every time spend my half an hour to read this blog's posts daily along with a mug of coffee.

    • Commenter avatarLogin to reply the answers
Still have questions? Get your answers by asking now.