Why Are Interest Rates On Cd's Not Mathematically Correct?

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Why Are Interest Rates On Cd's Not Mathematically Correct?

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investotron View Member Profile	Mar 22 2008, 04:58 PM Post #1
New MoneyMaker Group: Member Posts: 1 Joined: 22-March 08 Member No.: 138,475	I'm getting ready to start investing and I was thinking about getting some CD's. I went to bankrate.com and was looking at 1 month CD's interest rates. I started using their calculator and realized that math doesn't seem to work in the world of investing. If I invest $1,000.00 in a 1 month CD that offers a %2.75 interest rate compounded daily I will only make $2.29? How is the even logical? $1,000.00 x .0275 = $27.50 Please explain. I can make $2.29 a month by picking up change from underneath the couch. -------------------- MMG Signature Ad 1/3 - Trip of Money just began! Join in and enjoy! MoneyTrip.org MMG Signature Ad 2/3 - Slot Available MMG Signature Ad 3/3 - Slot Available