Opinions
Andrew Pink
iShares DEX Short Term Bond
XSB-T
BUY
Apr 30, 2025
$27.000
Stock price when the opinion was issued
E.T.F.'s
It's the ideal tool to help you make quicker, more informed decisions for
managing and tracking your investments.
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BUY
Some bond ETFs. Can invest $50K It's fine. It holds quality short-term bonds. both federal and provincial. He's owned this many times. He doesn't know ZCS. Also consider ZAG which holds short-, mid- and long-term bonds. If rates stay flat or decline, ZAG will do well. If you have $50K, buy two or three of these ETFs to spread the risk. Check the duration and credit rating of each.
E.T.F.'s
Likely that interest rates are coming down. BOC overnight lending rate is 2.75% right now and headed lower. Short-duration bonds are just going to yield less and less, and you can't enhance that yield without taking on more risk. More risk involves either extending bond duration or buying lower credit quality (and that's a big risk with markets the way they are today). Yield spreads widen when we get volatility. When a low-quality bond starts to yield more, that means its price goes down.
So he likes the short-duration aspect of this ETF. He's used it himself for cash management. You won't make the kind of returns you made in the past. To get a higher yield, you may want to diversify into preferred shares or some very high-quality equities.