I remember briefly hearing about an investment type which guarantees your initial investment. So you are able to make a reasonable (but not mind-blowing) profit but the initial capital that you pay is guaranteed

  • Nothing is guaranteed in life. But guessing a bond?
    – Ross
    Nov 18, 2015 at 19:20
  • 2
    A simple bank account fits that criteria, assuming it's government insured. Nov 18, 2015 at 19:44
  • and the government does not fail...
    – rhaskett
    Nov 19, 2015 at 21:27
  • @NateEldredge Well, other than I'd hardly call any savings accounts' profits "reasonable" these days... CDs are slightly better, though.
    – neminem
    Nov 19, 2015 at 22:02

5 Answers 5


GIC perhaps? These would be quite similar to Certificates of Deposit where one is agreeing to lock up their money for a term and be paid a percentage for doing so. There are various kinds as some may be linked to market returns in some cases and others are just simple interest.


Were you thinking of an annuity? They guarantee regular payments, usually after retirement.

In any case, every investment has counterparty risk. Bonds guarantee payout, but the issuer could always default. This is why Treasury bonds have the lowest yields, the Treasury is the world's most trusted borrower. It's also why "junk" bonds have higher yields than investment grade and partially why longer duration bonds have higher yields.

As mentioned, there's bank accounts, which gain interest and are insured by FDIC up to $250,000. If the bank folds, they'll be acquired by another and your account balance will simply transfer.

Similar to bank accounts are money market funds. These are funds that purchase very short term "paper" (basically <90 day bonds). They maintain a share price of $1 and pay interest in the form of additional shares. These have the risk of "breaking the buck" where they need to sell assets at a loss to meet investor withdrawal demands and NAV drops below $1.00. Fortunately, that's a super rare occurance, but still definitely possible.

Finally, there's one guy I've seen on TV pitching a no risk high yield investment. I can't remember the firm, but I am waiting to see them shut down for running a ponzi scheme.

  • An annuity is kind of the opposite of what's described: you get income, but you're guaranteed to lose the capital. Nov 19, 2015 at 13:36

You are likely thinking of a individual variable insurance contract (IVIC) , better known as a segregated fund, or a principal-protected note (PPN). For a segregated fund, to get a full guarantee on invested capital, you need a 100/100 where the maturity value and death benefit are each 100% guaranteed. The PPN works similar to a long-term GIC (or CD) with a variable investment component.

The thing is, neither of these things are cheap and the cost structure that is built in behind them makes it difficult to make any real above market rates of return. In both cases, if you try to break the contracts early then the guarantees are null and void and you get out what you get out.


I-series Treasury bonds are the closest thing you can get to an investment where your principal is guaranteed to be returned (even accounting for inflation).


Treasury Inflation Protected Securities are another option, but if you have to sell before maturity then 'the market' may not pay you back your initial investment.



In the UK there are Premium Bonds, http://www.nsandi.com/. In simple terms these get you a "raffle ticket" for each £1 you invest. Each month multiple tickets are drawn and they each win between £25 and £1m. Your capital does not go down but you aren't guaranteed to win. So you can't lose your money but there's potential to not make any either.

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .