- Link:
- https://horizonsetfs.com/ETF/hsav/
- Retailer:
- Horizons
I purchased $100k+ worth of shares in HSAV after I sold my apartment in June. It is a savings account ETF — essentially the fund owns a bunch of cash deposits, held in Canadian bank savings accounts and uses the economy of scale to negotiate better rates. This is not unique, but what is unique is the tax efficiency of the fund. The fund makes no taxable distributions, but rather the interest contributes to an increase in the share price. This means it gets taxed as capital gains when you sell rather than interest income. Great option for cash holdings not in an RRSP or TFSA.
Anyways, the yield rate just increased to 3.75% from 3.00%. So if you’re looking for somewhere to park money with a decent return in an unregistered account, I think it’s a great option. I’ve been extremely impressed with their next-day responsiveness to interest rate rises being reflected in the yield.
This is not financial advice. Do your own research to make sure it’s right for you. They stopped creating new shares in February, so the concern has been that the Market price could start trading well above the NAV. This hasn’t really happened – barring a few days where the price was about $0.25 above NAV. If I were buying in again I’d make sure I’m not paying too crazy of a premium above NAV. And if none of that made sense, go read about it until it does it’s not all that complex and it’s worth understanding (in my opinion even if you don’t buy in!).
Anyways, the yield rate just increased to 3.75% from 3.00%. So if you’re looking for somewhere to park money with a decent return in an unregistered account, I think it’s a great option. I’ve been extremely impressed with their next-day responsiveness to interest rate rises being reflected in the yield.
This is not financial advice. Do your own research to make sure it’s right for you. They stopped creating new shares in February, so the concern has been that the Market price could start trading well above the NAV. This hasn’t really happened – barring a few days where the price was about $0.25 above NAV. If I were buying in again I’d make sure I’m not paying too crazy of a premium above NAV. And if none of that made sense, go read about it until it does it’s not all that complex and it’s worth understanding (in my opinion even if you don’t buy in!).