Who offers best GIC or Term Deposit?

[Sugarphreak]

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[sputnik]

Why?

Can't you find a better place to put your money?

[Xtrema]

Originally posted by sputnik
Why?

Can't you find a better place to put your money?

Balance portfolio. I doesn't hurt to have some in safe places. Some say, your age should be the % of portfolio in cash as your risk tolerance lowers as you age.

That's said, that TD GIC is a scam. It's not 3.5% per year, it's 3.5% for total of 5 years which yields only 0.7% per year guaranteed. Even at the best scenario of 12%, you are still only getting ~2% per year.

And the remaining market growth GICs have no guarantees in interest, just principle. I bought something like this from TD which they no longer offer because it's shorter term and better guaranteed rate (minimum 1%, maximum 3% per year for 3 years). I guess they found out they can't profit from that.

You may as well deal with 1.2-1.6% or even e-saving account than these GIC products.

[Sugarphreak]

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[ExtraSlow]

Depending on your timeline, those tangerine accounts may be the simplest and best option for you.

Also, it's not technically "zero" risk, but if this was for long term capital preservation, I would have no issues going to Provincial or even some corporate bonds.

[Sugarphreak]

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[realazy]

Purpose High Interest Savings ETF - PSA

Flexibility of an ETF with the interest of a GIC. It invests in HISAs, I believe it's CDIC insured as well. "Free" ETF purchases with Questrade too, so that's a plus if you put money in sporadically.

I use it to park money in the trading accounts, but I've actually been moving money from TD to PSA since it pays a better rate than TD does.

[ExtraSlow]

You can hold bonds in your RSP.

[Sugarphreak]

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[realazy]

Another thing about those market growth GICs that TD has, they really suck now because I think they got burned in 2008.

I bought a couple of those in 2008, the bank one and the utility one, the bank one paid ~75% at maturity and the utility one about 40%.

[Sugarphreak]

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[realazy]

Originally posted by Sugarphreak

ETF's still carry some market risk, so for this part of my savings it isn't something I am looking at. I will probably be buying some in my RSP trading account in the future though.

Market risk, yes, but if you look at this ETF, it pays the interest monthly, and that is the amount that the price flucuates.

If you don't like ETFs, most banks have HISAs with comparable interest rates that you can buy in your trading account.

Some have minimum quantities and restrictions.

See here:

http://canadiancouchpotato.com/2010/...our-portfolio/

[Sugarphreak]

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[01RedDX]

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[Sugarphreak]

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[Feruk]

Originally posted by Sugarphreak
I am not opposed to ETF's at all actually, it is just this part of my portfolio is zero risk.

Assuming 2%/year inflation, if your savings account yields under 2%, you automatically have lost money. So it's zero risk, but guaranteed -ve return.

[Sugarphreak]

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[sputnik]

Originally posted by Sugarphreak

Are you retired?

Your mix looks like one that I would recommend to someone who is in their 70s.

With half of your porfolio in either cash (savings) or GICs (zero-risk) you are shrinking half of your portfolio from inflation.

Real estate is a decent investment if you are renting out a place you own, but not really much for building a portfolio just based on property value growth.

The fact that your high-risk (or even moderate risk) portions of your portfolio are under 10% makes me think that you should find a new financial advisor... unless of course you a retired pensioner in your 70s.

[Sugarphreak]

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[realazy]

If you're okay with smaller banks like Oaken, People's Trust has one of the higher interest rates.

http://www.peoplestrust.com/high-int...odays-rates-2/

Looks likea 5 year GIC is at 2.6% and a 1 year GIC is at 2.25%.