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Certificates of deposit (CDs) and Treasury bills are two of the most common and widely used cash equivalents.
* Bonds
Bonds, meanwhile, are debt instruments issued by a company or government to finance a certain aspect of its operation. When you invest in bonds, you are essentially lending money to the bond issuer, entitling you to receive interest on that loan, and a repayment of principal when the bond matures. Bonds come in a number of incarnations, including U.S. Treasury bonds, municipal bonds and corporate bonds.
* Stocks
Stocks round out the basic asset classes. Shares of stock represent ownership in a corporation...
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