I see HSAV managers have suspended it's subscriptions and recommends not buying shares. Here's a quote from their website.
"... investors should note that during a period of suspended subscriptions, the Manager expects shares of HSAV to trade at a premium to its NAV per share.
Due to this expected premium, Horizons ETFs is strongly discouraging purchases of shares of HSAV during this suspension of subscriptions."
Can you explain why they're making this recommendation, the risks in buying shares now and do you still recommend buying HSAV shares to park cash in a non-registered account?
Thanks.
This is not a new event; new sales have been suspended before now, and in fact for much of 2023. Managers of the fund want to ensure they have access to enough products/accounts to continue to achieve the fund's goals. Also, if a fund becomes too large it can create liquidity issues, if everyone decided to exit at once (regulators recently put in new rules on banks specifically for this reason). The manager makes this statement because it does not control the premium. If investors want units, they will bid up the premium. This will potentially impact total returns, if an investor buys at a higher premium than the premium when they sell. But we would still consider it a good product for parking cash. But investors should check the premium always before buying/selling. The premium right now is 0.47%. The premium disadvantage is offset by the tax advantage, as this is a total return fund with no paid distributions.