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In a weak moment last Fall, I locked into a 1.61% GIC for 5 years in my RRIF and a month thereafter regretted it. That is when I made the decision to stop buying any of this shite and consolidate into VCNS instead over time. Intention is to live dangerously on this portion of my portfolio which is more an annoyance than of meaningful value. 😁
 

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Between individual and joint accounts, we have 6 HISA accounts. Rates vary from 1.20 to 1.55. All taxable, some for upcoming tax payments.

I am not comfortable locking in at 1.60 for 5 years with inflation the way it is.
It’s especially depressing when some my GIC got matured with 3.7% rate ☹. Now I have more than 500k in Tangerine with 1.5% HISA... and soon 2 another GIC with high rate are matured. I’m tempted to decrease my Cash/FI allocation below 40% and buy some split pref with high protection and CEF that paying same dividends for ages and yielding from 5.5 to 9%
 

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It’s especially depressing when some my GIC got matured with 3.7% rate ☹. Now I have more than 500k in Tangerine with 1.5% HISA... and soon 2 another GIC with high rate are matured. I’m tempted to decrease my Cash/FI allocation below 40% and buy some split pref with high protection and CEF that paying same dividends for ages and yielding from 5.5 to 9%
Yep, preferred shares, CEF's, et al.

Put your capital at risk and the yield goes up commensurate with the risk. Simple equation.

Myself, when I put my capital at risk, I buy equities. For my fixed income allocation I buy fixed income where the capital is safe.

Simple.

ltr
 

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Retail investors seem to keep forgetting the purpose of the fixed income component of their asset allocation.

It's about safety AND re-balancing. The latter done on an opportunistic basis is what adds to portfolio returns, not the actual return (yield) on fixed income itself.
 

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Retail investors seem to keep forgetting the purpose of the fixed income component of their asset allocation.

It's about safety AND re-balancing. The latter done on an opportunistic basis is what adds to portfolio returns, not the actual return (yield) on fixed income itself.
Alta could you please explain this a little more - maybe with a theoretical example.
Are you saying that ETF managers "sell" some FI and "buy" more equities at lower prices - maybe all in house?
Thanks.
 

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I am not referring to ETFs at all but the same principle would apply to Asset Allocation ETFs as it does to personal portfolios. The best way to summarize it is: selling high the asset class that has out performed and buying low into the asset class that has under performed. As explained in Finiki and MoneySense.

I used the word opportunistic in my prior post because as Tom Bradley says in the MoneySense article, getting portfolio return boosts work only if either bonds have a real return and/or the portfolio has gotten skewed enough (equities crashing significantly) such as March 2020 or the 2008-2009 crisis that the significant divergence really does make a difference.

For the most part, the fixed income component of the portfolio provides safety in an equity market crash by making invested capital available if needed at what still would be market prices that have held up much better than equities. Assuming one's fixed income component is in investment grade holdings, not high yield junk bonds.

The Asset Allocation ETF providers do the same thing, buying and/or selling one or more of the underlying 5-7 holdings to keep the equity/bond split even.
 

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Gave up on BPY-UN, sold for cash today and used the cash to add to my ZRE holdings. I am still light on RE, particularly since RE's been a dog the last two years.
 

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Gave up on BPY-UN, sold for cash today and used the cash to add to my ZRE holdings. I am still light on RE, particularly since RE's been a dog the last two years.
That is the cleanest solution assuming the cap gains hit, if any, isn't a huge obstacle. It is certainly less messy.
 

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Gave up on BPY-UN, sold for cash today and used the cash to add to my ZRE holdings. I am still light on RE, particularly since RE's been a dog the last two years.
I also adding to my REITs... recently added to SRU, now has limit price to add to PLZ
 

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Added some CP this week at just over 90.
 

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I recently added to my REITs for those sweet dividends - however I also read Rich Dad Poor Dad for the first time this year - if you still haven't read it and don't have time to read a book right now check it out completely free through Amazon Audible and listen to it - Amazon.com: Rich Dad Poor Dad: 20th Anniversary Edition: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not! (Audible Audio Edition): Robert T. Kiyosaki, Tom Parks, Brilliance Audio: Audible Audiobooks
 

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Between individual and joint accounts, we have 6 HISA accounts. Rates vary from 1.20 to 1.55. All taxable, some for upcoming tax payments.

I am not comfortable locking in at 1.60 for 5 years with inflation the way it is.
HISA rates have dropped even further. According to this chart, just about all the HSAs are 1.25 or less. So you've lost your higher rates.

Ignoring stocks and talking about your fixed income allocation: are you sure you wouldn't rather lock in 1.60 or 1.70 in a 5 year? To really do better than this, you would have to actively jump between cash and GICs over the coming years. That's pretty hard to do. Most people cannot trade that kind of situation successfully.

With bond yields declining now, my guess is that GIC yields will soon decline as well.
 

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HISA rates have dropped even further. According to this chart, just about all the HSAs are 1.25 or less. So you've lost your higher rates.

Ignoring stocks and talking about your fixed income allocation: are you sure you wouldn't rather lock in 1.60 or 1.70 in a 5 year? To really do better than this, you would have to actively jump between cash and GICs over the coming years. That's pretty hard to do. Most people cannot trade that kind of situation successfully.

With bond yields declining now, my guess is that GIC yields will soon decline as well.
I am sure and have no interest (excuse the pun) in locking in for 5 years at those rates. At a 0.4% rate difference amounts to less than $200 per year after tax per $100k. I will stay liquid and see where the market heads.
 

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Bought 12k of Cargojet inside my TFSA. It has strong prospects for growth, has a strong relationship with e-commerce especially Amazon . Has also developed its business internationally and with the US. It also has a pretty strong moat when it comes to quick overnight deliveries for time sensitive products. I restrict my Canadian stock purchases to my TFSA. In the rest of my portfolio my holdings are US stocks. A lot more growth and diversity with the US markets.
 

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Bought TTR.V

Curious to see how this will go.
 
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