Debt Securities for Investing Excess Cash
This article discusses the three principal characteristics to consider when selecting debt securities for investing excess cash: default risk, maturity, and marketability.
Default Risk
Default risk is the possibility that interest or principal might not be paid on time and in the amount promised.
Maturity
Maturity refers to the time period over which interest and principal payments are to be made.
Marketability
Marketability refers to the ease with which an asset can be converted to cash.
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