Q: I have the fixed portion of my portfolio equally distributed across these two ETF's. The yield from CVD is much better currently at 5.33%, and ZMP is currently 3.05%. Any risk I'm not seeing if I only own CVD and get the higher yield?
5i Research Answer:
CVD as a convertible bond fund has higher risk due to its corporate exposure, as well as some 'equity like' exposure. ZMP is a Provincial bond fund and thus should be considered 'safer'. But CVD currently has a shorter average maturity, and we like convertibles right now. We would be comfortable with a switch, but they are different products with a different focus.