Investment Q&A

The main reason is GICs are fully guaranteed (up to $100,000) and ETFs are not in any way. The income from HMAX and UMAX can fluctuate, and unit prices will also fluctuate. In the past year, for example, HMAX has had price variability (high/low differential) of 27%. So if an investor had to sell at the 'wrong' time they could still lose money, which is impossible with a GIC. There is als specific sector exposure. Financials (HMAX) and utilities (UMAX). Now, that being said, we still consider them good products for income-seekers. They provide good income and 'some' downside protection from options income. But in a big market correction they are still going to decline, perhaps a lot. Investors need to understand these are not risk-free and shouldn't really be compared with GICs.