Information for the Cautious Investor
The cautious investor will use money market accounts which pay a small
but guaranteed return. Listed below are some internet resources that you
may find useful for gathering information about money market accounts and
selecting an account to invest in.
You will want to consider the following questions as you browse the sites.
You will report your findings on the CAUTIOUS INVESTOR WORKSHEET that will
be provided by your teacher.
- What is a money market account?
- What is the difference between a money market account and a money market
fund?
- What is the minimum balance required in the account?
- At this time, how much interest is the account earning?
- How often is the earned interest credited to the account?
As the Cautious Investor, you will ultimately advise your team on choosing
a money market account and choosing a dollar amount to invest in the money
market account for 12 weeks. You will need to keep track of how your account
performed each week on a line graph, and create a circle graph and douuble
bar graph to explain that performance. You will also need to calculate how
much your investment is worth at each checkpoint by using the formula described
on the following sites.
- TI-83 Calculator
(http://www.math.tamu.edu/~burgdorf/TVM/TVM.html) This site describes how
to compound interest using the TI-83 calculator.
- Lesson
2 Compound Interest (http://jwilson.coe.uga.edu/emt669/student.folders/callinan.michael/Essays/Finance/Finance.html)
This site explains the mathematics behind compound interest formulas.
- Plug
In The Numbers (http://www.finaid.org/finaid/calculators/finaid_calc.html)
This site allows you to plug in values for initial investment, interest
rate and how frequently the interest is compounded and will calculate the
interest earned on your investment.
Other Internet Resources
- Security Bank of
Springfield Illinois (http://www.securitybk.com/checking.html) This
site shows the types of money market accounts offered by the Security Bank
of Springfield and the current interest rates.
- First
Chicago Bank (http://www.fcnbd.com/per/fcb/deposit/savings/monmark.html)
This site describes the many money market accounts offered by First Chicago
Bank but does not list interest rates. You may need to verify current interest
rates by telephone.
- Bank Rate Monitor (http://www.bankrate.com)
This site gives information such as current interest rate, minimum balances,
restrictions and fees for several different money market accounts.
- Franklin National Bank
(http://www.fnb.net/rates.html) This site offers a listing of tiered money
market products, rates, and minimum balances from Franklin National Bank
on the East coast.
- Local Products (http://www.rate.net/)
This site gives a listing of all the interest rates offered through banks
located in the Downers Grove area.
- SFNB (http://www.sfnb.com/infodesk/mma_info.html)
On this site Security First Network Bank offers tiered money market accounts
and rates online. Do Not Apply for an account.