What are short-term investments typically meant for?

Short-term investments are typically characterized by their intended holding period of one year or less. This investment strategy is designed for individuals looking to have quick access to their funds while still earning some return on their investment, albeit usually lower compared to long-term growth investments. These investments might include money market accounts, short-term bonds, or certificates of deposit, which offer liquidity and reduce the risk associated with market volatility over short time frames. By focusing on a shorter duration, investors can respond more flexibly to their cash flow needs without locking their money in for an extended period.