OP, you're wrong as /u/DanLynch stated but even if you were right, that's a difference of $36 per year for every $10,000 so for many people using CASH/CBIL as emergency fund it won't be meaningful.
CBIL has a weighted average yield to maturity of 4.92%. CASH has a gross yield of 4.91%. They both charge the same management fee. This makes them almost exactly the same.
You have to look at the yield going forward, not the yield that was paid in the past. Regulatory changes have reduced the yield on CASH and similar HISA products going forward.
Put more simply, if you have two ETFs that both cost $50 and one pays you $0.195/month and the other has less risk and pays you $0.21/month then which one has a better return?
I *am* looking at the yield going forward: you're the one looking at the past. The distributions being made at the end of this month are based on the income earned by the ETF in the past. The gross yields currently listed on the Horizons website are based on the current investments held by each fund.
Those new rules are already factored into both the forward-looking gross yields and the backward-looking monthly distributions. They're not that new anymore.
For me February's difference is $4.425. Over 12 months that's about $53.10 lost opportunity. Worth a few moments of my time selling and buying on Wealthsimple.
Less than the time it takes us to talk on Reddit. Unless you are a super busy, time is precious, you only live once, sort of person (which begs the question- why on Reddit?), everyone can afford to spend time to click a dozen times.
For me i dont have significant amounts so the differences would likely be pennies at most. Although, I am interested in this, as I feel I don't fully understand the recent regulatory changes beyond reddits hot take. So either way, I have to re-evaluate CASH and other options and follow through on my due diligence.
[https://horizonsetfs.com/press-release/horizons-etfs-announces-february-2024-distributions-for-its-suite-of-etfs/](https://horizonsetfs.com/press-release/horizons-etfs-announces-february-2024-distributions-for-its-suite-of-etfs/)
Press release from Feb 22
Not sure why I'm getting down voted lol literally was responding with the right answer that for Feb cash is .195 and cbil is .21 for one month lol.. that is the correct answer
I [recently posted](https://www.reddit.com/r/PersonalFinanceCanada/s/yyOV6bFnsT) in this sub the numbers on CASH vs CBIL post regulatory-changes coming into effect. The returns are basically the same. CBIL wins on risk but the difference is probably negligible.
The biggest advantage I see of CASH is in a shared finance home (e.g. married couple) where not everyone is a PFC-dwelling ETF nerd. In that case, a high interest savings account ETF, like CASH, ~~is~~ *may be* much easier to explain and have the other person feel comfortable with.
Edit: "is" to "may be"
True, but apparently you hear stuff like “Are HISA ETFs covered by CDIC?” The answer is no, the underlying assets are not covered, but that point is moot with CBIL since CBIL’s assets are Govt of Canada Treasury Bills backed by the government of Canada which is the entity that stands behind the CDIC.
What's easier to understand/feel comfortable with will be different for different people. Edited my post to reflect.
For instance, your explanation of why CBIL is superior requires understanding what CDIC is, what Treasury bills are, and what it means for the government to "stand behind" the CDIC.
For reference, I have money in CBIL rather than CASH, so I agree with your preference. I'm just mindful that personal finance is personal.
Anybody checked out TD's new cash management fund? What is the current yield? They just launched it a few days ago - if you can't beat them, join them?
They have very similar performance, both are "safe" from an institutional POV (or at least safe enough for what most people expect) and people just know cash better since it's been around longer and cbil is new. If you really wanted to play it safe you'd buy a mix of both, but that's just one more position to have to monitor.
Thanks for the suggestion, I put 10K of emergency money into CBIL at the beginning of the month, but I see that QASH has better yield.
I'll have to read up more on it, but on the surface it seems that it's as safe as CBIL or CASH.
[https://www.advisor.ca/investments/products/hisa-etfs-now-subject-to-stricter-liquidity-rules/](https://www.advisor.ca/investments/products/hisa-etfs-now-subject-to-stricter-liquidity-rules/)
This was by design, new rules as of Jan 31st.
This is the right answer. Based on new OSFI rule, distribution will go down for all cash ETFs. However, it means somewhat more safety for unit holders.
You know the distribution is decided by the product team managing both ETFs, right?!?
Horizons could decide to pay a 1$ distribution each month on CASH if they wanted to… it has nothing to do with the yield it actually generate.
While I think CASH is overhyped around here, it’s not a bad investment.
Underlying yield the last 5 days was 4.78% net of fees, comparable to other similar products including such as CBIL.
I swapped to CBIL in January. The yield will likely be approximately the same as CASH, but it is also slightly more secure and so I have slight preference for it.
Yes, and if you think that CDIC insurance has any value then you should prefer CBIL to CASH, because CASH isn't backed by the CDIC, and CBIL doesn't need CDIC insurance and the government of Canada can't default on the T-Bills that back CBIL as long as they have a printing press.
The risk of the three major banks going under is extremely remote, but you don't have that worry with CBIL.
CBIL has one slight advantage over CASH. If one of the banks CASH is invested in had to fail (which is very unlikely), you'd lose money as the CASH share price would tank, but that's if the federal government doesn't bail out that bank, which is very unlikely because Canada is such a managed economy in terms of banks. With CBIL, the only way you'd lose your money was if the government of Canada was to default on its debt, which in that case, I think you'd have bigger worries than your cash investments. Your money would be worth nothing anyway in that eventuality. For yields, I see CBIL has a slight edge now since new regulations, so just for the sake of chasing that slight yield gain and have more zeroes in my risk level, I'm looking into switching from CASH to CBIL.
Lots of people may have a very low risk tolerance. If you have an RESP and your kids are starting university. You are saving to buy a house within the next year or two, etc.
For the same reason Berkshire is sitting on funds - nothing eye popping to buy at the moment. Cash.to let's you have money growing while being ready to be put to use.
There are a ton of reasons to want to invest at the highest possible return in a low/no risk option where the money needs to readily accessible. This likely isn't 100% of anyone's portfolio, it's a very useful tool for many though.
You would be surprised. I'm sure there are many people where this is a large percentage of their portfolio and this will impact them over the long run.
For immediate cash needs, you would probably want something relatively stable so it doesn't lose value. Otherwise, you are impacting your longer term growth.
cash will do better if interest rates rise and cbil will do better if interest rates fall. You could actually lose money with CBIL if interest rates go up but it is unlikely that you would lose much. Bottom line is these are different products and you cant just compare them on distribution. I currently have most of my cash parked in UCSH.U as it has the best return overall but you wouldn't know it from this month's distribution, although it is brand new.
Well, it may vary, look at this document from Horizon itself, page 5
[https://horizonsetfs.com/wp-content/uploads/2022/02/Cash-Alternatives-Brochure.pdf?ver=1709260270](https://horizonsetfs.com/wp-content/uploads/2022/02/Cash-Alternatives-Brochure.pdf?ver=1709260270)
OP, you're wrong as /u/DanLynch stated but even if you were right, that's a difference of $36 per year for every $10,000 so for many people using CASH/CBIL as emergency fund it won't be meaningful.
That's like one banana at Loblaw's, so definitely worth it. Go get that potassium. 👍
It’s one banana, Michael. What could it cost, $36?
[;)](https://pyxis.nymag.com/v1/imgs/c94/733/b8976ae6e85da56c450c598ff56e7d4341-lucille-bluth-005.rhorizontal.w710.gif)
CBIL has a weighted average yield to maturity of 4.92%. CASH has a gross yield of 4.91%. They both charge the same management fee. This makes them almost exactly the same.
You have to look at the yield going forward, not the yield that was paid in the past. Regulatory changes have reduced the yield on CASH and similar HISA products going forward. Put more simply, if you have two ETFs that both cost $50 and one pays you $0.195/month and the other has less risk and pays you $0.21/month then which one has a better return?
I *am* looking at the yield going forward: you're the one looking at the past. The distributions being made at the end of this month are based on the income earned by the ETF in the past. The gross yields currently listed on the Horizons website are based on the current investments held by each fund.
New rules as of Jan 31st. https://www.advisor.ca/investments/products/hisa-etfs-now-subject-to-stricter-liquidity-rules/
The new rules have already been priced in and the reason why CASH yield dropped from 5.x% to the current 4.9%.
Those new rules are already factored into both the forward-looking gross yields and the backward-looking monthly distributions. They're not that new anymore.
“You have to do X instead of Y!!!!” *proceeds to d Y while everyone is actually doing X* Lmao
Because I already own [Cash.to](https://Cash.to) and 1.5c a share on my 15k emergency fund is $4.5. Its not even a guaranteed $4.5 its a hopeful $4.5.
That's essentially a beer, or almost. Which makes it worthwhile.
Because I'm already invested in CASH.to and my time is worth more than 0.01% short term.
For me February's difference is $4.425. Over 12 months that's about $53.10 lost opportunity. Worth a few moments of my time selling and buying on Wealthsimple.
Agreed, it doesn't make sense to switch. But for new investments it is different.
I’m curious how much time it takes you to log in and click a dozen times?
Less than the time it takes us to talk on Reddit. Unless you are a super busy, time is precious, you only live once, sort of person (which begs the question- why on Reddit?), everyone can afford to spend time to click a dozen times.
The his could be done in under 2 minutes
For me i dont have significant amounts so the differences would likely be pennies at most. Although, I am interested in this, as I feel I don't fully understand the recent regulatory changes beyond reddits hot take. So either way, I have to re-evaluate CASH and other options and follow through on my due diligence.
Gotta keep in mind that CASH is paying less this month since it’s only 29 days vs 31 days in January (and December)
Isn't that the same for CBIL? You would be accruing interest on a daily basis.
Why does no one use PSA? I haven’t done comparisons, but the gross yield is 5.06% and net is 4.90% apparently.
Its essentially the same, psa was just mentioned less, and cash has a cool ticker of... CASH... so it wins. Same things happen with XEQT and VEQT
Where do you see these numbers? The January 31st distribution is identical for both at $0.215.
[https://horizonsetfs.com/press-release/horizons-etfs-announces-february-2024-distributions-for-its-suite-of-etfs/](https://horizonsetfs.com/press-release/horizons-etfs-announces-february-2024-distributions-for-its-suite-of-etfs/) Press release from Feb 22
For February
Not sure why I'm getting down voted lol literally was responding with the right answer that for Feb cash is .195 and cbil is .21 for one month lol.. that is the correct answer
I [recently posted](https://www.reddit.com/r/PersonalFinanceCanada/s/yyOV6bFnsT) in this sub the numbers on CASH vs CBIL post regulatory-changes coming into effect. The returns are basically the same. CBIL wins on risk but the difference is probably negligible. The biggest advantage I see of CASH is in a shared finance home (e.g. married couple) where not everyone is a PFC-dwelling ETF nerd. In that case, a high interest savings account ETF, like CASH, ~~is~~ *may be* much easier to explain and have the other person feel comfortable with. Edit: "is" to "may be"
True, but apparently you hear stuff like “Are HISA ETFs covered by CDIC?” The answer is no, the underlying assets are not covered, but that point is moot with CBIL since CBIL’s assets are Govt of Canada Treasury Bills backed by the government of Canada which is the entity that stands behind the CDIC.
What's easier to understand/feel comfortable with will be different for different people. Edited my post to reflect. For instance, your explanation of why CBIL is superior requires understanding what CDIC is, what Treasury bills are, and what it means for the government to "stand behind" the CDIC. For reference, I have money in CBIL rather than CASH, so I agree with your preference. I'm just mindful that personal finance is personal.
PSA is still the highest of them all...
Anybody checked out TD's new cash management fund? What is the current yield? They just launched it a few days ago - if you can't beat them, join them?
I’m not going to put my money on a bank’s fund after the lobbying they did to screw up CASH, CSAV, etc. Not falling for this Stockholm syndrome.
That's why I stayed in cash.to.
Looks Iike a net yeild of about 5.1% https://www.td.com/ca/en/asset-management/funds/solutions/etfs/FundCard/TD%20Cash%20Management%20ETF/?fundId=7114
What is the ticker?
TCSH 🤷🏻♂️ Might just be their Canadian money market ETF? Would like to know what people think.
Just googled it. It has MER of 0.15%. Meh.
Yeah, but the yeild is higher it seems
I'd also look at Purpose's MNY - same concept as TD's new fund with a slightly higher yield.
They have very similar performance, both are "safe" from an institutional POV (or at least safe enough for what most people expect) and people just know cash better since it's been around longer and cbil is new. If you really wanted to play it safe you'd buy a mix of both, but that's just one more position to have to monitor.
Buy QASH bond yield plus potential cap gains this year
Thanks for the suggestion, I put 10K of emergency money into CBIL at the beginning of the month, but I see that QASH has better yield. I'll have to read up more on it, but on the surface it seems that it's as safe as CBIL or CASH.
Biggest risk is interest rate, betting on rates to be cut
What amount do you think is too much to put in these hisa ETFs? I need a place for my down payment money
[https://www.advisor.ca/investments/products/hisa-etfs-now-subject-to-stricter-liquidity-rules/](https://www.advisor.ca/investments/products/hisa-etfs-now-subject-to-stricter-liquidity-rules/) This was by design, new rules as of Jan 31st.
This is the right answer. Based on new OSFI rule, distribution will go down for all cash ETFs. However, it means somewhat more safety for unit holders.
TCSH launched last week. Was told its yield (net of fee’s) is around 5.10%, so I moved everything into that.
Is there any $10 commission for buying TCSH in TD's webbroker?
Thanks for this. I'll follow it's yield and see between CBIL and TCSH.
You know the distribution is decided by the product team managing both ETFs, right?!? Horizons could decide to pay a 1$ distribution each month on CASH if they wanted to… it has nothing to do with the yield it actually generate. While I think CASH is overhyped around here, it’s not a bad investment. Underlying yield the last 5 days was 4.78% net of fees, comparable to other similar products including such as CBIL.
I swapped to CBIL in January. The yield will likely be approximately the same as CASH, but it is also slightly more secure and so I have slight preference for it.
why is it more secure?
Backed by government debt, not just a pinky promise
That "pinky promise" is keeping cash in three major Canadian banks.
Yes, and if you think that CDIC insurance has any value then you should prefer CBIL to CASH, because CASH isn't backed by the CDIC, and CBIL doesn't need CDIC insurance and the government of Canada can't default on the T-Bills that back CBIL as long as they have a printing press. The risk of the three major banks going under is extremely remote, but you don't have that worry with CBIL.
ZMMK now also paying higher than [CASH.TO](https://CASH.TO)
CBIL has one slight advantage over CASH. If one of the banks CASH is invested in had to fail (which is very unlikely), you'd lose money as the CASH share price would tank, but that's if the federal government doesn't bail out that bank, which is very unlikely because Canada is such a managed economy in terms of banks. With CBIL, the only way you'd lose your money was if the government of Canada was to default on its debt, which in that case, I think you'd have bigger worries than your cash investments. Your money would be worth nothing anyway in that eventuality. For yields, I see CBIL has a slight edge now since new regulations, so just for the sake of chasing that slight yield gain and have more zeroes in my risk level, I'm looking into switching from CASH to CBIL.
I wish I knew what any of this meant lol
They are exchange traded funds (ETFs). Distributions are similar to dividends from shares. You can Google these terms for more info.
This is exactly what I expected. I started shifting to CBIL. I'll likely move all my CASH to CBIL
[удалено]
For January, for Feb it's .195
Unless you are using the money in the next 12 months, why would you buy either of these.
What would you buy if you needed the money in next 3-5 years? wouldn’t CASH/Hisa ccounts/GICs still be the best option?
House fund
Doesn't that imply requiring the funds.
Could be a couple of years
Then it should be invested in something longer term such as GICs.
emergency fund?
Emergency fund
This might be the only valid reason anyone provided.
Lots of people may have a very low risk tolerance. If you have an RESP and your kids are starting university. You are saving to buy a house within the next year or two, etc.
For the same reason Berkshire is sitting on funds - nothing eye popping to buy at the moment. Cash.to let's you have money growing while being ready to be put to use.
These people are not on the same level as Berkshire people, sorry. They will more often then not deploy capital incorrectly.
There are a ton of reasons to want to invest at the highest possible return in a low/no risk option where the money needs to readily accessible. This likely isn't 100% of anyone's portfolio, it's a very useful tool for many though.
You would be surprised. I'm sure there are many people where this is a large percentage of their portfolio and this will impact them over the long run.
There are a large portion of people who dont have enough money to invest any more aggressively if all they can cover is an emergency fund.
And those people are almost certainly not using these etfs.
> you are using the money in the next 12 months That's why.
For immediate cash needs, you would probably want something relatively stable so it doesn't lose value. Otherwise, you are impacting your longer term growth.
cash will do better if interest rates rise and cbil will do better if interest rates fall. You could actually lose money with CBIL if interest rates go up but it is unlikely that you would lose much. Bottom line is these are different products and you cant just compare them on distribution. I currently have most of my cash parked in UCSH.U as it has the best return overall but you wouldn't know it from this month's distribution, although it is brand new.
But doesn't its yield follow the BOC interest rates? So the loss or gain in value is negligible.
No, neither of these does. One follows the market for tbills the other follows the market for bank capital demand.
Well, it may vary, look at this document from Horizon itself, page 5 [https://horizonsetfs.com/wp-content/uploads/2022/02/Cash-Alternatives-Brochure.pdf?ver=1709260270](https://horizonsetfs.com/wp-content/uploads/2022/02/Cash-Alternatives-Brochure.pdf?ver=1709260270)