Short-Term Investment

[short-term in-VEST-ment]

What is the definition of Short-Term Investment?

An investment of excess cash intended to be held for a brief period, usually less than one year, to meet upcoming financial obligations or for temporary financial gain.

Using Short-Term Investment in an Example

A company may invest its excess cash in short-term government securities that can be readily converted back to cash within a few months, ensuring the funds are available to cover upcoming operational expenses.

Using Short-Term Investment in a sentence

Our CFO decided to allocate the surplus funds into short-term investments to optimize our cash flow management.

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