Q: Wondering what your favourite/safest High Interest savings ETF would be to park cash for a few months or maybe a little longer.
Are there any risks associated with these ETFs?
I note for CASH, todays price is 2% greater then the 200 day moving average. Can these drop in value?
CASH management fee is .11%-is this high?
Why are the distributions variable on a monthly basis?
Thanks
Jeff
Are there any risks associated with these ETFs?
I note for CASH, todays price is 2% greater then the 200 day moving average. Can these drop in value?
CASH management fee is .11%-is this high?
Why are the distributions variable on a monthly basis?
Thanks
Jeff
5i Research Answer:
Note that these ETFs are not CDIC-insured. However, given that the deposits are in the top five banks, we are not worried about such risks. These ETFs can definitely drop in value, however, we do not think the drop will be significant enough. The management fee is average across the board and even considering the potential return, we think the fee is worth the liquidity and attractive yield. The fund keeps negotiating or relocating deposits to higher savings accounts resulting in changing distributions. Another reason could be the changing interest rates that have happened very frequently recently resulting in changing savings rates offered by the banks.