Riskalyze makes it easy to build portfolios that include Certificate of Deposit (CD) products.
- Open the client's portfolio and click into the Add Investment field and select Create Custom.
- Enter in a dollar amount and press Enter to create a Custom Investment.
- Next, click on the investment you just added to show the Risk / Return Scenario.
- Enter the name of your investment (one that is identifiable to you and will look good on a client-facing document
Advice: The key for any custom investment is to not overthink it, and have a foundation for your inputs.
- For Worst Case, use whatever you deem the worst case (downside) to be. For example, Brokered CD's may have potential downside, based on their terms. For Bank CD's and Brokered CD's held to maturity, use half the annual interest rate for the Worst Case.
- For Best Case, use half of the annual interest rate.
- Set Correlates Like to Cash.
- Click SAVE - you're finished!
Example 1: CD Held to Maturity
A CD paying a 2.25% annual return, held to maturity:
- Worst Case: 1.125%
- Best Case: 1.125%
Example 2: Brokered CD
A brokered CD paying a 2.5% annual return, -1% potential penalty for early withdrawal:
- Worst Case: -0.5%
- Best Case: 1.25%