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All marketable debt securities are held at cost on a company's balance sheet as a current asset, until a gain or loss is realized upon the sale of the debt instrument. Marketable debt securities are held as short-term investments and are expected to be sold within one year. If a debt security is expected to be held for longer than one year, it should be classified as a long-term investment on the company's balance sheet.
Lesson Summary. Short-term investments are any asset that is anticipated to expire within one to three years, has low risk, and offers low returns. Examples of some types of short-term investments are savings accounts, certificates of deposit (CD), money market funds and treasury bills.