floating-rate demand notes

[Paws]

His anyone used these? See article
Duke, GE Tempt Savers With Higher Yield Than Money Funds - Bloomberg
I know GE, Duke Energy and Ford credit issue them. They are not FDIC insurerd just wonderring if I spread my money around to all three to diviersify a little to creat a money market fund. Rates are better then what my money market account gets.

Article says it is a much better deal for the company then for the investor.

Any thoughts on them?

[pb4uski]

No, but they sound like a reasonable alternative to MM funds albeit with some additional credit risk.

I would prefer TIAA Direct savings account at 1.25% APR and FDIC insured.

[jebmke]

3 issues is not diversification

[Paws]

Quote:

Originally Posted by jebmke 3 issues is not diversification

I know that is not real good diversification but it would be a portion of my cash not the majority.

Does anyone know of any other demand notes?

[Paws]

Quote:

Originally Posted by pb4uski No, but they sound like a reasonable alternative to MM funds albeit with some additional credit risk. I would prefer TIAA Direct savings account at 1.25% APR and FDIC insured.

I will have to look into them how is there customer service?

[pb4uski]

Quote:

Originally Posted by Paws I will have to look into them how is there customer service?

I don't have a TIAA account - they are a recent entry to online banking and I previously had an account with DiscoverBank paying 0.8% and haven't bothered to switch. Many believe that the 1.25% rate they are currently paying is a bit of a teaser to attract deposits and may be reduced later - only time will tell.

However, I think that generally speaking that TIAA has a reputation for good service. Perhaps others have some direct experience with them.

[Animorph]

Why not a floating rate mutual fund or ETF? Fidelity and TRP each have one. Not sure if they hold the same stuff you're looking at. And they looked a little volitile for a step up from cash.

[brewer12345]

Run Away!!!