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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: How safe is something like CASH or PSA? I know they invest in the deposit accounts of banks and credit unions and are not protected by CDIC. But what is the worst case scenario? That one of the banks fails? Just trying to determine how much of a safety difference there is between these and a GIC. Thanks!
Read Answer Asked by TK on March 22, 2024
Q: Is there a US dollar version of these that would not have the 15% withholding tax?

Thanks for all your great work
Mark
Read Answer Asked by Mark on March 21, 2024
Q: Hi,

My partner I are doing financial planning, we will need a relatively significant (to us) amount of cash in the next 2-5 years for replacing aging cars and a down payment on a larger house.

I am always hesitant to hold cash/GICs for fear of missing out on growth opportunities. Currently, almost all the funds in our RRSPs and TFSA's are invested EXCEPT a long term GIC that came to term and is now sitting in cash (some in TFSA, some in Non-registered). We will need all this cash in the next 2-5 years.

I am looking for ideas on how to manage the cash.

Right now, the best option I can see is GICs with various terms, do you have any other suggestions or ideas to consider?

(we have already owned a house, so cannot use RRSP loan or the new FHSA)

Thanks
Read Answer Asked by Mark on March 15, 2024
Q: I understand this is a new ETF issued by TD Asset Management. There is a little information on its website. I am interested in it as a short term cash management option. I could not determine the yield. If you look at the current holdings, it states over 90% is invested in other than Canada. In its top 10 it holds a number of Trusts and when you look into these they represent a range of money market investment options including car loans, credit card debt, etc. Though it states the risk is low, its holdings would seem to suggest otherwise. Firstly, can you compare TCSH yield with that of GICs or HISAs. Further, do you have an opinion of this ETF as a place to park money. If you prefer other like ETFs would you also state how you would rank them. Thank you.
Read Answer Asked by Ken on March 11, 2024
Q: I am retired and looking to park some cash. TCSH and MCAD appears to be another type of ETF being offered around fixed income. These ETFs along with ETFs like PSA and CASH seem to be a good place to park some cash for a while. What would your opinion be on the safety of either type of ETF and any advantages or disadvantages of either class of ETF?


Ken
Read Answer Asked by Ken on March 07, 2024
Q: HI,

What is a good time to sell these units/ETFs? To lock in the distribution of that month's interest? I am looking at taking some cash off these and be ready to deploy the capital. Not in a rush. But want to be prepared.
Read Answer Asked by Savalai on January 23, 2024
Q: I am looking to park some cash for a while but have it relatively easily accessible. I understand that these ETF’s are not CDIC insurable but other than that what is the downside/risk of these ETFs and which one would you consider the best? Also I noticed that these etf’s are trading above their set value…$50.14. Under what circumstances would they trade back to their $50.00 value?
Read Answer Asked by Ken on January 22, 2024
Q: Hello, the distribution paid by these ETFs is starting to come down, even before the new rules becoming effective Jan 31th. Distributions will also follow the BoC rate when it starts going down as well. What would happen if shareholders start selling PSA, CSAV or CASH en masse? Is there some sort of marketmaker for these ETFs that, no matter what, will keep the share price close to NAV? Thanks.
Read Answer Asked by Martin on January 15, 2024
Q: Regarding CASH and similar etfs:
Couldn’t the price fall if/when interest rates decrease?
I realize that in such a scenario the price may fall below NAV, but potential buyers may not care until the price falls low enough for the yield to be attractive. In this way, it seems as if they could trade similar to a long bond. If so they could hardly be considered cash alternatives. Your help in understanding this, please.
Read Answer Asked by john on January 02, 2024
Q: Happy Holidays,
I have a question about tax efficiency on HISA ETF investments in non-registered accounts. Do the dividends received from these ETFs qualify for any dividends tax credits? Or are they being treated as interest income, such as GIC, which will be subject to the usual marginal tax rates?

Thank you,
Read Answer Asked by Roger on December 23, 2023
Q: My daughter has opened her First time Home buyer Savings Account with the intent to wait 1 ½ to 2 years until she will be ready to purchase her first home. Do you have any ETF's you would like to suggest ?
Read Answer Asked by Gord on December 20, 2023
Q: I intend to invest a significant amount of cash ETFs in my TFSA ,could you suggest a list of safe ETFs with interest,or even short term bond ETFs if pertinent with this objective,aiming at preservation of capital and 4% + to 5% revenue, would it be better to hold just one ETF or a mixture is better in this context,many thanks for your excellent work
Read Answer Asked by Jean-Yves on December 08, 2023
Q: I need to sell 1/3 of my portfolio and park the cash for 3-6 months. TD will not allow me to buy PSA, CASH, HISA, or HSAV. Can you recommend a few other good options.
Thank you,
Derek
Read Answer Asked by Derek on October 27, 2023