Index-linked Certificate of Deposit Law and Legal Definition

Index-linked Certificate of Deposit is a certificate of deposit with a return based on a specific index. In an Index-linked Certificate of Deposit, the certificate of deposit is purchased for a fixed price. The certificate is often sold through bank branches and affiliated and unaffiliated brokers. An index-linked Certificate of Deposit is a deposit obligation of the issuing bank. There is no risk of loss as the certificate is FDIC (Federal Insurance Corporation insured). Depending on the outcome of the index, there is a chance for a high return.