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GIC Wealth Management Broker Rates
November 9, 2021
10:09 am
canadian.100
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savemoresaveoften said

will bite when it hits 3.2-3.5 area, fingers crossed  

I heard some of Tiff Macklem's (Gov BoC) recent briefings/speeches in which he expects inflation to hit 5% in the next few months and then settle back to the targetted 2%. If you believe him, around 3.5% for GICs might work, but if his prediction is not correct and inflation goes to 5% or goes higher and stays at those levels, then I do not think a 5 year 3.5% GIC rate is spectacular in that circumstance. However, I do realize that GIC purchasers put the CDIC protection at a higher priority than interest rates and 3.5% probably sounds like a dream come true after more recent range of 1% to 2% GIC rate level for GICs, depending of course on the issuing FI.

January 19, 2022
6:35 am
gicjunkie
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GIC Wealth Latest rates: 5 years up to 3.02%

1 year 1.99%*
18 month 2.15%*
2 year 2.30%*
30 month 2.40%*
3 year 2.60%**
4 year 2.80%*
5 year 3.02%*
* Minimum Investment $25,000
** Minimum Investment $50,000
*** Minimum Investment $100,000

January 20, 2022
1:59 pm
Loonie
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Their one year rate is now up to 2.05 with 25K min.
https://gicwealth.ca/gics-rates/

January 25, 2022
6:31 am
gicjunkie
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Today's Newer Rates:

1 year 2.10%*
18 month 2.15%*
2 year 2.40%*
30 month 2.40%*
3 year 2.70%*
4 year 2.90%*
5 year 3.10%*

*Subject to $25,000 minimums

February 8, 2022
8:48 am
hwyc
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18-month GIC now 2.45% sf-smile

February 10, 2022
3:43 pm
Loonie
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GICWealth and Monarch Wealth are currently both offering 3.00% on a FOUR year GIC.
I thought this milestone was worth celebrating!sf-smile

February 11, 2022
4:31 am
canadian.100
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Loonie said
GICWealth and Monarch Wealth are currently both offering 3.00% on a FOUR year GIC.
I thought this milestone was worth celebrating!sf-smile  

I read in Yahoo finance this morning — Inflation soared over the past year at its highest rate in four decades, hammering American consumers, wiping out pay raises and reinforcing the Federal Reserve’s decision to begin raising borrowing rates across the economy.
The Labor Department said Thursday that consumer prices jumped 7.5% last month compared with a year earlier, the steepest year-over-year increase since February 1982.

It is worth knowing about this 7.5% "milestone" while you celebrate your 3% GIC milestone.

February 11, 2022
7:07 am
Norman1
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That's the US and not Canada.

As well, the inflation is not expected to last. According to Bloomberg: United States Rates & Bonds, 10-year US government bonds are trading at a yield around 2% per annum and 30-year US government bonds at 2.3% per annum.

February 11, 2022
7:42 am
canadian.100
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Norman1 said
That's the US and not Canada.

As well, the inflation is not expected to last. According to Bloomberg: United States Rates & Bonds, 10-year US government bonds are trading at a yield around 2% per annum and 30-year US government bonds at 2.3% per annum.  

I realize that is for the US for January. Would expect for Canada rate January will be between 5% and 5.25% - I have not seen the exact number published as yet.
Yes I see that the 5 year govt bond rate is around 2% - I notice my reset preferred shares are resetting at much higher interest rates than last reset 5 years ago.

February 11, 2022
9:13 am
Loonie
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Every solitary person on this forum is aware of inflation. Trying to make that look worse by quoting US statistics undermines the comment.
Most of us here (maybe not canadian100) are also happy when GIC rates rise. They've gone up substantially in the last six months or so and are still going up. They are a completely different class of investment than preferred shares and should not be directly compared. It's apples and oranges.

February 11, 2022
9:20 am
HermanH
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Just got off the line with GIC Direct, one of the three GIC brokers listed on the GIC page, and was told that the best 1-yr rate has changed from 2.31 to 2.33 from WealthOne, if anyone was interested.

I was glad to learn the institution, in order to stay under the maximum CDIC coverage limit.

February 11, 2022
11:37 am
canadian.100
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Loonie said

Most of us here (maybe not canadian100) are also happy when GIC rates rise. They've gone up substantially in the last six months or so and are still going up. They are a completely different class of investment than preferred shares and should not be directly compared. It's apples and oranges.

That is incorrect - I am elated and over the moon, as you are, to see GIC interest rates rise. My point was simply that rising interest rates are also good for investments other than GICs - some of us here are diversified to other than GICs - so it is very nice to see gains in the portfolio resulting from the increase in interest rates.

February 11, 2022
11:59 am
Loonie
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Perhaps another time you will consider sharing your elation before your sour grapes when rates go up.

February 11, 2022
2:09 pm
Bill
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GIC interest rates alone are utterly meaningless unless compared to other things, such as inflation (and even rate reset preferreds') rates during the term of the gic, i.e. I'd rather get 1.5% when inflation is 1% then get excited just because gic rates have happened to hit a number like 3% (without taking account likely inflation rates during that period). Being happy about gic rate rises alone, while seemingly a staple of many gic lovers, is only a partial analysis, not really a logical, complete look at the picture. It's always useful to be reminded of that, I find.

In the long run, are there any reasons Canada's inflation rates wouldn't be very close to USA's?

canadian.100, I'd just ignore anyone on here trying to direct what I say, how and when I say it, etc. Your input here is typically helpful and informative.

February 11, 2022
2:28 pm
Loonie
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GIC rate increases are always meaningful.

But I do understand you are opposed to such expressions of delight.

Good grief!

February 11, 2022
2:53 pm
Nehpets
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Loonie said
GIC rate increases are always meaningful.

But I do understand you are opposed to such expressions of delight.

Good grief!  

Now that's comedy!!
sf-laugh

In light of current world events, I needed a chuckle today!

February 11, 2022
4:40 pm
canadian.100
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Bill said
GIC interest rates alone are utterly meaningless unless compared to other things, such as inflation (and even rate reset preferreds') rates during the term of the gic, i.e. I'd rather get 1.5% when inflation is 1% then get excited just because gic rates have happened to hit a number like 3% (without taking account likely inflation rates during that period). Being happy about gic rate rises alone, while seemingly a staple of many gic lovers, is only a partial analysis, not really a logical, complete look at the picture. It's always useful to be reminded of that, I find.

In the long run, are there any reasons Canada's inflation rates wouldn't be very close to USA's?

canadian.100, I'd just ignore anyone on here trying to direct what I say, how and when I say it, etc. Your input here is typically helpful and informative.  

Thank-you for your comments. I agree that just because a GIC rate reached 3% for a 4 year term when inflation is bound to be a much higher number (possibly 5% to 6% in Canada for January - yet to be announced) it is not a valid reason on its own to be "happy" or "mark a milestone". I agree that 3% sounds better than the last few years of under 1% to perhaps 2%. Loonie makes some good comments at times but unfortunately can be quite direct and rather abrupt if he does not like one's post. Whenever anyone talks about stocks or inflation, Loonie very clearly does not want to hear about that subject. Well perhaps we don't want to hear his endless complaints about the big banks and the banks who don't offer joint accounts. I believe EQ is now on his bash list.
When I referred to the Yahoo Finance article about US inflation - he commented in Post 113 that it was sour grapes on my part. Such nonsense!

February 11, 2022
6:52 pm
AltaRed
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canadian.100 said
Yes I see that the 5 year govt bond rate is around 2% - I notice my reset preferred shares are resetting at much higher interest rates than last reset 5 years ago.  

For what it is worth, those resets, depending on the spread, will be called if the bond rate gets too high, probably in the order of 2.5-3%. They, in effect, have ceilings (limited upside) and plenty of downside (to the spread). P.S. I own a few too.

Interest rate increases are needed to a certain degree to cool asset inflation but that is about all they are good for. They are headwinds to stocks (discounted cash flow valuations in addition to debt servicing costs) and murderous to bond funds NAV due to near term lag as rates increase. It is shaping out to be a tough year.

FWIW2, this site has some strong opinions about various subjects and they are well known to each other. I am not very interested in interest based products myself, nor do joint accounts have any value to me or my family, but I find it worthwhile to participate to keep a pulse on what is going on from a corporate (shareholder) perspective, estate matters and to at least argue with y'all about inflation. sf-wink

February 12, 2022
12:41 am
canadian.100
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AltaRed said
For what it is worth, those resets, depending on the spread, will be called if the bond rate gets too high, probably in the order of 2.5-3%. They, in effect, have ceilings (limited upside) and plenty of downside (to the spread). P.S. I own a few too.
Interest rate increases are needed to a certain degree to cool asset inflation but that is about all they are good for. They are headwinds to stocks (discounted cash flow valuations in addition to debt servicing costs) and murderous to bond funds NAV due to near term lag as rates increase. It is shaping out to be a tough year.
sf-wink  

I would not be unhappy if the Rate Resets get called - that has not happened as yet. I bought them over 12 years ago at issue - yes they were volatile but they paid high dividends (4% to 6%) (plus tax benefit because of DTC) through the very low interest years that followed so I am fine if they get called. You are correct about bond funds - bad to have when rates are increasing - fortunately I don't have any. The common shares I have pay good dividends (Banks and Financials) and hopefully will increase their dividends. Have some ETFs XIC, ZEB, VTI and VUN - I will hold for the long term. I am open to buying perhaps some 1 year to maximum 18 month GICs depending on interest rate - 2% is not quite enough for me considering inflation and tax factor. I am not so sure inflation is going to come down to 2% for quite some time but we shall see how 2022 progresses - agree it could be a tough year on many fronts.

February 12, 2022
5:28 am
savemoresaveoften
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Just to chime in quickly on prefs, as long as one is not sensitive to the price volatility (as in no panic sell or sell for whatever reason), prefs is not a bad ‘fixed income’ product. Even for the rate reset prefs, their min dividend is usually at least 3-4% given they reset at spread over 5y, so holding it long term they actually beat a GIC esp with the dividend tax credit.
The best prefs were the min rate reset that were issued a few years back and yielding 5-6%, all those are being called now.

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