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Senior Mumbler
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Looking for info about cdars and what the 'pros' think of it as a protective tool for large deposits while staying liquid.
 

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CDARS are (or were) a pool of CDs that was issued by about 2000 U.S. banks that offered maturities from 1 month to 5 yrs. The advantage they gave investors was that you could get up to $50 million in FDIC coverage. They offer rates that are competitive with brokered CDs. There are some restrictions. You can invest up to $7.5 million at a time in the 1 month maturity, $6.5 million in the 3 month - 1yr maturities, $1 million with the 2 year maturity, 750K with the 3 yr and 400k in the 5 yr. The 1 month has a minimum investment of $1 million, the 3 month - 5 year require a $500K minimum investment. IF YOU ARE INVESTING FOR MUNICIPALITY OR PUBLIC FUND LOCATED IN TEXAS, read your investment policy carefully. Most Texas public funds state, "CDs bought for the public portfolio must be held by a bank or banks in Texas". CDARS are held at the Bank of New York. Unfortunately, this program may be done away with next week due to the credit crunch. I did receive CDARS rates for this week and I should receive the rates for next week tomorrow, I'll Keep you posted.
 

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We did get rates today for CDARS so I guess they are in business for at least another week. The APY with daily compounding is 2.071 on the 1 month, 2.326 on the 3 mo, 2.736 on the 6 mo, and 3.354 on the 1 yr.
 
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