The Capital Preservation Pool is composed mostly of laddered Certificates of Deposit (and some cash for even greater liquidity). Certificates of Deposit typically have the highest interest rates among government-insured savings products. Although interest rates are low compared with historical returns, CDs have a place in investment strategies (e.g., for funds established by organizations to support capital projects or other immediate needs).
Laddering involves setting up multiple CDs so that they mature at staggered intervals. The longer the CD’s term – and sometimes the larger the deposit – the higher the rate. So, a CD ladder provides the benefit of a blended interest rate and accessibility.
To serve our funds with short-term investment horizons, DCF has designated an appropriate portion of its total assets to purchase laddered CDs from Janney Montgomery Scott, LLC*. Each CD is FDIC insured.
|Cash and Equivalents||0-100%||0%||BofA ML 3-Month T-Bill|
|Short Term U.S. Government Debt||0-100%||100%||BofA ML 3-Month T-Bill|