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Are there any disadvantages to cash ETFs over GICs? It seems like it’s all gravy to me.
I see 3 points you should have in mind :
• you don’t get a guaranteed rate, the rate could go up or down at any time
• cash ETF aren’t insured, so even though limited, counter party risk exists (ETF manager or deposit bank failure)
• OSFI is currently reviewing these ETF because banks complained about them, so things may evolve for them in the next few months
Ah right, you pay for the liquidity with rate volatility.
I really hope the banks don’t get their way. It sounds like they just don’t like the competition.