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Horizons Active Ultra-Short Term Investment Grade Bond ETF (HFR)
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iShares Core Canadian Short Term Bond Index ETF (XSB)
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Vanguard Canadian Short-Term Bond Index ETF (VSB)
Q: What is your recommended short term CAD bond etf? Can you briefly discuss your top 3?
5i Research Answer:
We like the iShares Core Canadian Short-Term Bond ETF (XSB) for its large AUM of $2.5B, decent distribution yield of 2.5%, low MER of 0.10%, and effective duration of 2.7 years. We also like the Vanguard Canadian Short-Term Bond ETF (VSB) - it has an AUM of $1.1B, an MER of 0.11%, a distribution yield of 2.3%, and a duration of 2.6 years. For a slightly different short-term bond ETF, there is the Horizons Active Ultra-Short Term Investment Grade Bond ETF (HFR), which has an AUM of $0.4B, a higher yield of 5.5%, an MER of 0.46%, and a low duration of 0.45 years.
For high liquidity and slightly more price sensitivity, we like XSB, and for a higher yield and less price sensitivity we like HFR.