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Brokerage investment savings accounts
August 29, 2023
6:45 am
savemoresaveoften
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AltaRed said
Bond pricing seems to be pretty opaque. While in some cases, the commission rate might look good, the bid/ask spread may not be. Remember that one is buying or selling into the dealer's inventory (not the open market) and they can price it as they see fit. IOW, do not rely on commission rate alone. I no longer buy bonds.  

Well they are not going to hold inventory for nothing. I buy bonds as long as the net yield looks good, not care so much how much fee I am paying. Its not like tomatoes which I can shop around easily or even grow in my own backyard !

August 29, 2023
7:24 am
AltaRed
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Of course, it is the net yield that really matters. The rest is ultimately not relevant to the buyer.

The point of my prior post is not to get fooled by what is posted as commission between brokerages. Those numbers are distractions to what really matters - net yield.

September 1, 2023
9:42 am
AltaRed
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As posted in another forum this morning....

BMO reduced their BMT124/129/134 USD HISAs to 4.90%.
BMTxxx CAD also reduced to 4.75%.

September 2, 2023
5:18 am
Norman1
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Since last update, BMO reduced its rate:

ISA (Canadian Dollars) Rate
BMO High Interest Savings Account (BMT104) 4.75%
Scotiabank Investment Savings Account, Series A (DYN6000)
Equitable High Interest Savings Account, Series A (EQB1000) 4.65%
Home Trust High Interest Savings Account, Class A (HOM100)
Manulife Bank Investment Savings Account (MIP510)
B2B Bank HIIA, Series A (BTB100) 4.55%
NBI Altamira CashPerformer Account, Series A (NBC100)
RBC Investment Savings Account, Series A (RBF2010)
Renaissance High Interest Savings Account, Series A (ATL5000)
TD Investment Savings Account, Series A (TDB8150)
September 2, 2023
11:30 am
AltaRed
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FWIW, I don't think much should be read into the BMO ISA rate decrease. I think they recognized they didn't need to be that high to compete with the 4.55%/4.65% offerings of their competitors. More NIM to them provides a needed boost to their bottom line given latest quarterly results.

September 4, 2023
2:18 pm
fsabbagh
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savemoresaveoften said

Yes they allow you to buy the A series but not the F. But then that is expected.
Or you can buy the CIBC money market fund and if over $100k can get the premium funds for extra yield (due to lower MER)  

Hi,

I can't figure out how to buy the HISA on CIBC from BNS. Can you please explain where on the site and how.

Thx!

September 4, 2023
3:42 pm
AltaRed
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fsabbagh said

Hi,

I can't figure out how to buy the HISA on CIBC from BNS. Can you please explain where on the site and how.

Thx!  

I assume you are meaning CIBC Investor's Edge brokerage account and you want to buy the DYN6000 (A series) or DYN6004 (F series) from BNS?

If so, and I do not have a CIBC IE account, but I imagine you would find it under the Mutual Fund trading tab. ISAs are not mutual funds but they use the mutual fund order system to buy/sell. You may, or may not, be able to buy the F series version.

September 4, 2023
3:53 pm
Bill
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Correct, I have a CIBC Investors Edge accounts and that's how you buy DYN A series ISAs, as if they were mutual funds. If I recall correctly I tried once to buy F series but was unable to.

September 6, 2023
10:47 am
rodeworthy
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I only recently began investing in GICs via an online brokerage - in my case that is BMO Investorline. I have a situation I don't understand with regard to a GIC purchase I made August 18/23.

Previously, I opened GICs in my RIF account with BMOIL and selected 'Bank of Montreal' as the provider. Those GICs are active and are reported as expected. They are listed as "BMO GIC ANN" in my holdings list.

On August 18 I opened another GIC in the same account but this time I chose 'BMO Trust' as the provider. A few days later - around Aug 25, I noticed IL reporting the value of that investment had increased by 0.02%. It remains at that value to this day. I don't know where this increased 'value' comes from and don't know if it is a variable amount that can go up or down.

BMO-Trust-GIC.gif

As shown in the table above the investment is listed as 'BMO TR CO GIC CPD'. I would like to know what the term 'CPD' means in this instance. That is probably a clue to why this GIC is different than the previous GICs I purchased. I like to track my investments to make sure they agree with the providers. I am not sure how to categorize this increase (or potential decrease) in the value of my GIC principal prior to maturity.

Can someone out there explain this to me?

September 7, 2023
10:22 am
MyUsername
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rodeworthy said
As shown in the table above the investment is listed as 'BMO TR CO GIC CPD'. I would like to know what the term 'CPD' means in this instance.   

Just a guess, CPD might mean "compound" interest for your 2 yr. GIC

Usually there's nothing you need to do for a GIC other than report the interest in the year it is earned. For your 2 yr. GIC with a maturity date in 2025, you'll need to report the 1st year interest on the tax return for 2024, and the 2nd year interest on the tax return for 2025.

September 7, 2023
1:30 pm
AltaRed
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I agree CPD means compound interest. That means the accrued value of your GIC will go up every time BMO decides to update it. I had always assumed it would be updated daily, but perhaps it is done on a monthly cycle (which I would have normally thought to be the last day of each month).

I would be surprised if you did not see an updated value in your Holdings on an ongoing basis.

September 8, 2023
11:55 pm
RetirEd
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Generally, compounding is done only at fixed intervals, and I would be surprised that any financial institution would show an uncredited amount... but that "unrealized gain/loss" item confuses me...

RetirEd

September 9, 2023
7:23 am
AltaRed
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RetirEd said
Generally, compounding is done only at fixed intervals, and I would be surprised that any financial institution would show an uncredited amount... but that "unrealized gain/loss" item confuses me...  

Why is it confusing? Brokerages always have an unrealized gain/loss column and it is simply the current market value less cost basis (book value). The unrealized gain/loss in this case is simply accrued interest earned to date on that GIC (however it is calculated) and not yet paid out. A bond is handled in a similar way, i.e. it accrues interest on a daily basis until paid out.

September 9, 2023
8:11 am
Norman1
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Does the purchase confirmation slip for the BMO Trust GIC or the transactions of the account, from August 18 onwards, show any adjustment to the GIC? Perhaps, BMO InvestorLine assigned some of the commission from the issuer BMO Trust to you!

Customary deposit brokerage commission is ¼% per GIC year. BMO InvestorLine would receive around ½% commission for placing a two-year GIC. However, usually an assignment will show up as an improvement in the GIC's rate and not as an increase in the GIC's value.

It doesn't look like accrued interest being reported. If it was accrued interest, then that 0.20% would grow by about 5.43% / 365 = 0.01488% with each passing day.

September 9, 2023
8:56 am
AltaRed
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Norman1 said
It doesn't look like accrued interest being reported. If it was accrued interest, then that 0.20% would grow by about 5.43% / 365 = 0.01488% with each passing day.  

It is difficult to know with the information we have. Each brokerage may show accrued value differently and I've never had a GIC with BMO IL. In the case of Scotia iTrade, they show accrued values every single day, i.e. what I see online today is the accrued value (market value) of the previous business day.

September 9, 2023
9:17 am
kesa
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AltaRed said

It is difficult to know with the information we have. Each brokerage may show accrued value differently and I've never had a GIC with BMO IL. In the case of Scotia iTrade, they show accrued values every single day, i.e. what I see online today is the accrued value (market value) of the previous business day.  

Are you referring to GICs here? My CAD and USD GICs at Itrade do not show accrued value.

September 9, 2023
10:19 am
AltaRed
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Sure they do. It is the Market Value column that changes every day, at least in the case of Compound GICs which is all that I have ever purchased.

RBC Direct Investing does exactly the same thing for my spouse's compound GICs.

Added: The unrealized gain/loss column shows the amount of accrued interest (both in Scotia iTrade and RBC Direct Investing).

September 9, 2023
10:25 am
kesa
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AltaRed said
Sure they do. It is the Market Value column that changes every day, at least in the case of Compound GICs which is all that I have ever purchased.

RBC Direct Investing does exactly the same thing for my spouse's compound GICs.

Added: The unrealized gain/loss column shows the amount of accrued interest (both in Scotia iTrade and RBC Direct Investing).  

For me, GICs held at Itrade are annual. I guess that’s why accrued does not show? Which is odd because annual GICs held at EQ and Tang show the accrual.

September 9, 2023
10:45 am
AltaRed
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kesa said

For me, GICs held at Itrade are annual. I guess that’s why accrued does not show? Which is odd because annual GICs held at EQ and Tang show the accrual.  

I suppose that could be the difference. Perhaps GIC issuers do not provide the brokerage with that information, i.e. the brokerage isn't going to be calculating that information on their own. I confess to never having owned an annual paying GIC in my lifetime.

September 10, 2023
5:08 am
RetirEd
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Well, I haven't dealt with brokerages, I will admit. But I'm still confused, seeing all the responses here...

RetirEd

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