Zero-Coupon Certificate of Deposit (CD)

A Zero-Coupon Certificate of Deposit is the certificate of deposit which is bought at a rate lower than its face value, i.e. at a discount and the interest payment is received at the maturity date of the Certificate of Deposit. Zero-Coupon Certificate of Deposits are a tool of minimum risk for investing and saving but an investor has to wait for a longer period to receive the interest payments.