High Interest Cash (< 5.02%) [CAD/USD] [CDIC: NO!] + Money Market ETFs

Great, thank you OP!

I believe MER is what they actually charge on your investment. Management fee is a reference and often reduced.

https://www.investopedia.com/articles/i ... vs-mer.asp

Therefore the distribution yield for BMO ZMMK is the distributed yield net of MER, not the gross yield.

ADenariusSaved wrote: ↑ Updated in remarks. MER still stands at some ridiculous value, but Management fee pretty good at 0.12%. Sometimes criminal records / MER are useful.

tsuda wrote: ↑ Great, thank you OP!

I believe MER is what they actually charge on your investment. Management fee is a reference and often reduced.

https://www.investopedia.com/articles/i ... vs-mer.asp

Therefore the distribution yield for BMO ZMMK is the distributed yield net of MER, not the gross yield.

Oh crap, I see. Thanks for the lead and the clarification. Learned something new, how did I miss that for a decade +. I'll change Gross Yield to Distribution Yield.

And it's done!

No worries. I believe you were correct before with the other ETFs, e.g. CASH.to they list the gross yield on their web site:
https://horizonsetfs.com/ETF/cash/#product-facts
and you have to manually substract the MER to get the distribution yield.

ADenariusSaved wrote: ↑ Oh crap, I see. Thanks for the lead and the clarification. Learned something new, how did I miss that for a decade +. I'll change Gross Yield to Distribution Yield.

And it's done!

tsuda wrote: ↑ No worries. I believe you were correct before with the other ETFs, e.g. CASH.to they list the gross yield on their web site:
https://horizonsetfs.com/ETF/cash/#product-facts
and you have to manually substract the MER to get the distribution yield.

Revision #83 restored! Love version control.

Outside of HSAV or CASH, what are other places to park your money for relatively safe fixed income with easy exit liquidity in Canada should you want to use that money to buy stocks in case of a big market pullback (which you can't with a locked GIC)?

PHuth2 wrote: ↑ Outside of HSAV or CASH, what are other places to park your money for relatively safe fixed income with easy exit liquidity in Canada should you want to use that money to buy stocks in case of a big market pullback (which you can't with a locked GIC)?

Second link in my sig...Not as good as these, but def safer with CDIC protection, if you believe in it.

PHuth2 wrote: ↑ Outside of HSAV or CASH, what are other places to park your money for relatively safe fixed income with easy exit liquidity in Canada should you want to use that money to buy stocks in case of a big market pullback (which you can't with a locked GIC)?

PSA.TO is my fave.

dealhawk1 wrote: ↑ PSA.TO is my fave.

Why PSA more than CASH ? Rate isnt better, mer is higher. Volume is not that great.
That said, for diversification reasons, i may buy in april some PSA as my 5% tangerine promo will expire and i have already enough CASH etf shares (I have CASH for money i cant move at all).

can anyone recommend US exchange traded high interest ETFs similar to these? thanks!

ADenariusSaved wrote: ↑ Second link in my sig...Not as good as these, but def safer with CDIC protection, if you believe in it.

I am using the HISA from the other OP thread. For the broker I am using , there is no commission for trading HISA while there is commission for trading the products in this thread. It is easy to get in and out from HISA without paying a dime.

As of today HSAV has a NAV of $103.97 but its market value $105.04 Does that mean that people are paying a premium of 1.07$? That sounds very high to me. Am I right?

Denis54 wrote: ↑ As of today HSAV has a NAV of $103.97 but its market value $105.04 Does that mean that people are paying a premium of 1.07$? That sounds very high to me. Am I right?

Yes, when stock market is down. People selling stocks like madness. They need a quick place to park money. So they are buying HSAV but not many people want to sell. As the result, HSAV will have way higher premium compared to NAV.

When stock market is up. They will sell HSAV like madness to get money for buying stocks. As the result, HSAV will have lower premium compared to NAV.

X360 wrote: ↑ Yes, when stock market is down. People selling stocks like madness. They need a quick place to park money. So they are buying HSAV but not many people want to sell. As the result, HSAV will have way higher premium compared to NAV.

When stock market is up. They will sell HSAV like madness to get money for buying stocks. As the result, HSAV will have lower premium compared to NAV.

or, if interest rate start dropping, the price will go below NAV??

cheapshopper wrote: ↑ or, if interest rate start dropping, the price will go below NAV??

Today NAV = yesterday NAV + yesterday interest.
Therefore, the price kinda never go below NAV if we still have positive interest rate. Nobody will sell the price below the NAV if they know the NAV keeps increasing (+ interest) every day.

It's only go below the NAV if we have negative interest rate like Europe used to have...
https://fortune.com/2022/06/08/ecb-inte ... te-policy/

X360 wrote: ↑ Today NAV = yesterday NAV + yesterday interest.
Therefore, the price kinda never go below NAV if we still have positive interest rate. Nobody will sell the price below the NAV if they know the NAV keeps increasing (+ interest) every day.

It's only go below the NAV if we have negative interest rate like Europe used to have...
https://fortune.com/2022/06/08/ecb-inte ... te-policy/

I think there is the possibility of market inefficiencies that would make its price drop below NAV for a short period of time. It’s basically acting as a stock now and if tomorrow the BOC had an emergency meeting and decide to drop rates or announce that rate drops are definitely coming soon, there will be a sudden outflux of funds toward stocks whereby folks would want to sell at any price just to free up their cash to get in the market upswing ASAP.

joepipe wrote: ↑ can anyone recommend US exchange traded high interest ETFs similar to these? thanks!

Don't like the TSX ones?
It's weird, I put in a quick search even with search term NYSE and I keep getting Canadian hits. Even with different terms like cash ETFs, HISA ETFs, USD, money market ETFs etc...You may want to try your hand at it.

Otherwise there are ones on the TSX you can presumably buy in USD, which will use US Federal Reserve interest rates...I have a US section in the thread summary.

CanadaCool wrote: ↑ I think there is the possibility of market inefficiencies that would make its price drop below NAV for a short period of time. It’s basically acting as a stock now and if tomorrow the BOC had an emergency meeting and decide to drop rates or announce that rate drops are definitely coming soon, there will be a sudden outflux of funds toward stocks whereby folks would want to sell at any price just to free up their cash to get in the market upswing ASAP.

Someone has to raise a lot of cash desperately to sell a massive amount for it to dip below NAV. With it not creating any more units and being the only tax advantage cash etf, it wont trade below NAV under 99.9% of the scenario.
As others already point out, the NAV goes UP each day naturally.

So essentially you will need a scenario similar to 2009 when some money market fund "break the buck".
Google it if you are not familiar with what happened back then.

ADenariusSaved wrote: ↑ Updated in remarks. MER still stands at some ridiculous value, but Management fee pretty good at 0.12%. Sometimes criminal records / MER are useful.

I'm wondering whether you should start a new thread on money market mutual funds and ETFs. To me, money market funds (whether mutual funds or ETFs) are very different from HISA ETFs and deserve a separate discussion. I see money market mutual funds were also discussed in the other thread that you started so there's clearly interest in them. This new thread will also be another one for your signature line!

No I have the TSX ones... I'm looking for a US resident friend I have

joepipe wrote: ↑ No I have the TSX ones... I'm looking for a US resident friend I have

These might be too low risk for the yanks lol...

This is all I remember when reading American books. I guess as they increase interest rates, you can get longer maturity T-Bills, but the newly minted ones will yield more. I remember I worked out with a university buddy on coop, and one day in the TTC, he was like, man, if I had a lot of money, I'd get T-Bills. I was like, wtf is that? Back in 2007, they were around 4.xx%'ish? Smart move because we crashed after that. The permanent portfolio will also use these, if relevant...

Example: NYSE: SGOV: https://www.ishares.com/us/products/314 ... y-bond-etf

These T-bill rates are around 4%, you'll probably find better stuff. I'm wondering if you can just punk the Treasury directly at treasurydirect.gov ? These are probably the safest assets known to man right now. Backed by full faith and credit of the USA and all its associated CNVs, Castle Bravos, F22s, M1s, Bradleys, 5.56's, and Blackhawks. Better than CDIC, or FDIC in their case.

Maybe a 'murican can help us out here. But as the rates are headed up, I wouldn't blow everything in one load, at least wait until Powell hikes the rate in the next 2 weeks if you go the direct route. If you go the ETF route, then it probably doesn't matter since they just roll everything anyway.