Hi to all,

Here we are in our beautiful autumn season, a time of year I always enjoy.

We have recently come across an interesting article discussing the value of current 5.5% GICs in relation to stock market risk.

The markets decreased by approximately 21% from December 2021 to September 2022. Currently the US and Canadian markets are still approximately 8% lower than the December 2021 high water mark.

During this market decline, we saw interest rates on 1-year GICs rise from 1.2% to a current rate of *5.84%.

Having raised a large amount of cash from rebalancing profitable equity positions in early 2022, we have been steadily building 3-year GIC ladders as part of most client portfolios. (Ladder is a term used for buying 1-, 2- and 3-year GICs.)  

With short-term cash earning approximately 5%, and rotating GIC maturities over the next 3 years, clients are well positioned to take advantage of higher rates, should they materialize. Portfolios are also well positioned to take advantage of any market opportunities that may become available.

Most portfolios also continue to have equity positions in strong dividend paying companies as good long-term investments.

Enjoy our beautiful fall.