GICs not coming from the big banks and the Home Capital saga

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Bobetpine
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GICs not coming from the big banks and the Home Capital saga

Post by Bobetpine » 11 May 2017 11:49

Hi,

Is it me or GIC rates that I see on BMO IL are going up (a little bit)?

I have a lump sum to invest in GICs and wonder if I should wait a bit or jump in right now. I know that Home Capital is reporting results tonight and I wonder if it's reasonable to wait in case rates would go up again. I know that you don't read crystal balls but you could be aware of things I don't know/don't understand.

Thanks

PS: not worried about bankruptcy, all GICs offered by BMO IL are CDIC backed.

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AltaRed
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Re: GICs not coming from the big banks and the Home Capital saga

Post by AltaRed » 11 May 2017 12:22

GIC rates depend on what needs to be offered to attract deposits for mortgage lending purposes. Influences include the 2-5 year bond yield curve, and speculation on BoC short term interest rate movement. If you have a 6 sided dice, roll it.
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SoninlawofGus
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Re: GICs not coming from the big banks and the Home Capital saga

Post by SoninlawofGus » 11 May 2017 13:28

Agree with AR. Even the GICs sold through brokerages are a good 1% more than the comparable 5-year GOC bond. You'd need to go out to six years or so to get the same with provincials (which have gotten better if I'm not mistaken). I don't know what's going to happen with rates. It could be that the worst news is priced in regarding the Home Capital saga, but I have no idea.

2of3aintbad
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Re: GICs not coming from the big banks and the Home Capital saga

Post by 2of3aintbad » 11 May 2017 17:01

It is true that best GIC rate on BMOIL has gone up from just under 2% at the beginning of the year to 2.10% which I think the high for the year. But it is discouraging to see that the 5 year rate available outside is from Canadian Tire Bank at 2.5%, and that it is only 1.95% via BMOIL.

Hopetoretire
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Re: GICs not coming from the big banks and the Home Capital saga

Post by Hopetoretire » 14 May 2017 08:22

http://www.zerohedge.com/news/2017-05-1 ... e-capital-

How much truth in this article about the banks' actions on Home Trust deposits and should I be concerned (have several Home Trust GIC's though RBCDI and TDDI)?

Sorry I don't understand CDIC coverage vs bail-out in this situation ...

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NorthernRaven
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Re: GICs not coming from the big banks and the Home Capital saga

Post by NorthernRaven » 14 May 2017 09:08

Hopetoretire wrote:
14 May 2017 08:22
http://www.zerohedge.com/news/2017-05-1 ... e-capital-

How much truth in this article about the banks' actions on Home Trust deposits and should I be concerned (have several Home Trust GIC's though RBCDI and TDDI)?

Sorry I don't understand CDIC coverage vs bail-out in this situation ...
Step 1: Relax. Everything under the CDIC $100K limits is protected, in all circumstances, should it come to that.

Step 2: Stop reading ridiculous websites like zerohedge... :)

2of3aintbad
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Re: GICs not coming from the big banks and the Home Capital saga

Post by 2of3aintbad » 15 May 2017 13:47

2of3aintbad wrote:
11 May 2017 17:01
It is true that best GIC rate on BMOIL has gone up from just under 2% at the beginning of the year to 2.10% which I think the high for the year. But it is discouraging to see that the 5 year rate available outside is from Canadian Tire Bank at 2.5%, and that it is only 1.95% via BMOIL.
To follow up on this, on BMOIL the best 5 year rate went up to 2.15% on Friday and 2.25% today (both Equitable Bank). Second highest is 2.10% Concentra Bank.

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AltaRed
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Re: GICs not coming from the big banks and the Home Capital saga

Post by AltaRed » 15 May 2017 15:07

On Scotia iTrade, both Home Trust and Equitable Bank are 2.25% and Concentra is 2.1%
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BRIAN5000
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Re: GICs not coming from the big banks and the Home Capital saga

Post by BRIAN5000 » 15 May 2017 15:14

Oaken is looking for money :shock:

Guaranteed Investment Certificates (GIC)

Long-term GICs

Term 5 Year
Annual compound or annual pay 2.60
Semi-annual 2.55
Monthly 2.50
“Sometimes you are going to sell early and wish you would’ve held on, other times you will hold on a
little bit longer and wish you would’ve sold early - this is just part of the game.” - Frank Zorilla via Abnormal Returns

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AltaRed
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Re: GICs not coming from the big banks and the Home Capital saga

Post by AltaRed » 15 May 2017 16:15

That should capture some renewals.... albeit unlikely new money.
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poedin
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Re: GICs not coming from the big banks and the Home Capital saga

Post by poedin » 16 May 2017 08:54

BRIAN5000 wrote:
15 May 2017 15:14
Oaken is looking for money :shock:

Guaranteed Investment Certificates (GIC)

Long-term GICs

Term 5 Year
Annual compound or annual pay 2.60
Semi-annual 2.55
Monthly 2.50
This morning I'm seeing 2.85 (compound/annual) 2.75 (monthly) for the five year!
other rates https://www.oaken.com/gic-rates/

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