brokerage firm recommendations for CDs

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Moritat
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brokerage firm recommendations for CDs

Post by Moritat » Thu May 17, 2018 9:45 am

I've noticed the best CD rates seem to be brokered cds. I'm happy with my brokered cd rates from Ameritrade, but I have some additional cash I'd like to put with another brokerage firm. I never compared the cd rates from Ameritrade with other firms, but I would think there might be some other investment companies who have brokered cd rates that match or exceed those from Ameritrade. Just wondering if anyone can recommend some other brokerage firms who have excellent cd rates.

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Tyler Aspect
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Re: brokerage firm recommendations for CDs

Post by Tyler Aspect » Thu May 17, 2018 1:28 pm

I would give Fidelity a try.
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stlutz
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Re: brokerage firm recommendations for CDs

Post by stlutz » Thu May 17, 2018 1:32 pm

Note that brokered CD rates are not always better than direct CDs. The rates on brokered CDs tend to respond to change (up or down) more quickly than Direct CDs. Not sure if one or the other is better on average.

informal guide
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Re: brokerage firm recommendations for CDs

Post by informal guide » Thu May 17, 2018 1:46 pm

Typically, Vanguard and fidelity rates are very close; I'd encourage you to use the firm where your relationship is centered.

New issue CDs are easiest and are usually at par; you may squeeze a few more basis points of yield out of CDs in the secondary market, albeit with the hassle of amortizing premiums or discounts if not bought at par and a lack of FDIC coverage on a premium if you buy at over par.

123
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Re: brokerage firm recommendations for CDs

Post by 123 » Thu May 17, 2018 4:25 pm

Recently rates on Treasury securities maturing in less then 2 years have been a little higher than the rates for comparable brokered CDS in many cases. For some people who live in a state with income tax treasury securities are popular since the interest is not taxed by the state.
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indexfundfan
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Re: brokerage firm recommendations for CDs

Post by indexfundfan » Thu May 17, 2018 4:31 pm

I have compared treasury pricing on the secondary market at Fidelity, Schwab and Vanguard. Schwab's pricing are by far the best.
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Moritat
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Re: brokerage firm recommendations for CDs

Post by Moritat » Thu May 17, 2018 8:40 pm

Thanks for the replies. It looks like Fidelity, Schwab and Vanguard would be the ones to check out, and I'll do just that. I know there are plenty of websites that compare CDs from traditional banks. It would be great if there was a website that compared brokered cd prices. I assume this kind of website doesn't exist, correct?

123
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Re: brokerage firm recommendations for CDs

Post by 123 » Thu May 17, 2018 9:41 pm

Moritat wrote:
Thu May 17, 2018 8:40 pm
... It would be great if there was a website that compared brokered cd prices. I assume this kind of website doesn't exist, correct?
I'm not aware of any site of that kind. When comparing brokered CDs at different brokers sometimes you'll see the same issue, same interest rate at multiple brokers. After you compare awhile you'll see how some banks likely raise much of their deposits from brokered CDs. I've also seen Wells Fargo brokered CDs at far higher rates versus what they offer if you go to one of their retail branches. Brokered CD inventory seems to often vary a lot from day to day, and some brokers seem to have the most inventory available online during normal trading hours (when NYSE is open).

I've often been curious about how the brokered CD business works, I wonder if there is a central exchange that handles everything for the brokers or if each offering is a separate "deal" between the broker and the offering bank.
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peterinjapan
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Re: brokerage firm recommendations for CDs

Post by peterinjapan » Thu May 17, 2018 10:02 pm

I am super happy with Fidelity's automated CD ladder tool. And 2.8% for 24 months seems fabulous to me.

https://www.fidelity.com/learning-cente ... cd-ladders

ndnboy
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Re: brokerage firm recommendations for CDs

Post by ndnboy » Fri May 18, 2018 3:31 am

Just opened a Merrill Edge act and looking at setting up CD ladder, anyone have experience working with them? Seems like their search tool allows you to purchase CDs across the board as well.

Mr. Digweed
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Re: brokerage firm recommendations for CDs

Post by Mr. Digweed » Fri May 18, 2018 11:33 am

I have a Merrill Edge brokerage account. Have been with them for several years and purchased their Brokered CDs without any difficulty for the past four years. No problems for me.

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