What are solid bearings?

Fixed deposits are credit arrangements where the specific amount of funds is placed on a deposit under the name of the account holder. The money placed on the deposit is obtained by a fixed interest rate according to the conditions that the account controls. The actual amount of the fixed rate may be influenced by the factors in the type of currency connected to the deposit, the time established for the deposit and location where the deposit is made.

The most unusual characteristic of a fixed deposit is that the means cannot be selected for a specified time. In most cases, they have fixed bearings for five years. During this time the money remains on the account and cannot be downloaded for any reason. Individuals, corporate entities and even non -profit organizations that want to allocate funds and reduce their access to resources for a certain period of time, often find that solid deposits are a simple way to achieve this goal. As another advantage, Monina on the account will gain a fixed interest rate regardless of any interest rates that apply to Nand other types of accounts.

However, both advantages can also turn into disadvantages under certain circumstances. Because the money cannot be downloaded until the time is completed, the funds cannot be used even in emergency situations. Changes in the passing interest rate may also increase to a point beyond the interest rates applied to existing deposits. This means that account holders actually earn less interest on fixed deposits than with other types of loans and accounts.

While the interest rate for fixed deposits cannot be changed, sometimes there is a way to solve the question of raising the use of funds in an emergency situation. A credit institution where a fixed deposit is deposited may sometimes be willing to expand a separate loan of an account that uses a fixed account as a collateral. Although it is not ideal, it can at least allow you to deal with the current financial crisis.

Fixed deposits are a credible way tomake a return on investment, which is somewhat higher than a standard savings account. The use of solid deposits can also be useful in working with different types of currency. Determination, which is known as a solid deposit of foreign currency or FCFD, can be selected the type of currency connected to the deposit and locking at the interest rate. If the currency selection is good, it means that the investor can enjoy a healthy level of currency with a fixed deposit for the entire duration of the deposit and earn more than a standard fixed deposit strategy. However, going with FCFD contains a slightly higher amount of risk, as the funds stored must be converted to the currency of the choice and after the deposit is met, converted back. If the currency is in progress there is a chance to obtain loss, due to changes in the exchange rate since the fixed deposit was activated until the deposit was considered complete.