Everbank World Currency CD

Everbank_World_Currency_CD When you think of a certificate of deposit, you probably think, safe, boring, and low interest rates. And that does describe most CDs, including all of the CD interest rates we track. But Everbank offers a unique option among CDs–the World Currency Index CD. With Everbank’s World Currency CDs, you not only invest in certificates of deposit, but you also gain exposure to a basket of foreign currencies. So how do these CDs work?

As with most CDs, Everbank’s foreign currency CDs offer a fixed rate of return. The fixed rate depends on the length of the CD and the basket of foreign currencies you choose. For example, the commodity index CD is comprised of equal amounts of currency from 4 commodity-rich nations (Australia, Canada, New Zealand, and South Africa). It currently pays a fixed rate of 2.17% APY on 3-month CDs and 2.29% APY on 6-month CDs. In contrast, the Viking Index CD is comprised of currencies from 3 Nordic countries (Norway, Denmark and Sweden) and currently pays fixed rates of just 0.24% and 0.26% APY on 3 and 6-month CDs, respectively.

In addition to the fixed rate of return, the CDs fluctuate based on any changes in the values of the currencies that comprise the Index CD versus the U.S. dollar. This means that the actual return can be a lot higher or lower than the fixed rate. In fact, unlike most traditional CDs, you can lose principal with a World Currency Index CD. The advantage is that it gives you exposure to foreign currencies, particularly when the U.S. dollar has been under so much pressure as of late.

Everbank currently offers 15 different baskets of currencies to chose from. CDs come in either 3-month or 6-month terms. As with other CDs, you deposits are FDIC-insured. There are no monthly account fees, but the minimum to open a foreign currency CD is $20,000.

For more information, to check current rates, and to open an account, visit Everbank

(Photo Credit: bradipo)

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