What is the opportunity cost of participating in this program and letting Fidelity have $100k of either your money or your securities (including bonds)?
a. If you are transferring bonds or other securities their is no opportunity cost.
b. If you are transferring cash which you plan to invest in securities or bonds at Fidelity there is no opportunity cost.
c. If you are transferring money which you do not intend to invest at Fidelity there is an opportunity cost; that being the difference in the interest earned at Fidelity (negligible) compared to the interest earnable elsewhere. AS AN EXAMPLE;
$100 K at Fidelity for 9 months will earn $75. The same amount which I have at Country Bank in Portchester, NY will earn $575 at .7% p.a.. Accordingly, in this example my opportunity cost of participating in this program is $575.
Substitute your own bank's interest rate to determine your opportunity cost.
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