Larry Berman CFA, CMT, CTA BMO Ultra Short-Term Bond ZST-T WEAK BUY Dec 16, 2024

A corporate bond money market fund maturing under a year and is good for parking cash.

This hold short-term corporate bonds which yield a little more than the government equivalent, safe. You assume a little credit risk, not much

Basically, it's a corporate money market fund. Is a lot safer than JAAA in terms of credit risk and dividend yield. Note: High-interest savings ETFs used to pay more than money-market funds until the government got rid of that. The best of the lot is ZST.

Corporate-based money market account. Will generate about 30 bps (ballpark) more than what you'd get in a traditional money market fund. Canadian T-bills from 1 month to 1 year are roughly at a 2.6% yield; add a small fee for running the money market fund, and your yield is about 2.5%.

With ZST, you'll get something like 2.8-2.9%. Very safe, very high quality corporate credits in Canada. Great vehicle for a number of years to get an enhanced yield on your cash savings.

Avoid. GICs are guaranteed, but bond ETFs are not. In 2022, when rates starting going up, bond funds traded down. A bond ETF can be part of a portfolio and work well, but they haven't added much in recent years. Better to look at 10-20 years in bond maturities. These are not safe.

Very good short-term bond product, with a good mix of bonds. Doesn't have any now, but has owned in past. Wouldn't hesitate to buy again. Right now, you want bonds as short as you can get them.

Yes, it's a very safe vehicle. It's a good way to extract a bit more yield than from just a traditional money market account.

The challenge is that it's fully taxable. Instead you may want to look at some preferred securities, which give you a bit higher yield (bit more risk, but better tax treatment). Investors will need to do their own research on individual ETFs. Whatever the choice, it can be combined with ZST for safety of principal.

ETF designed as a money market security, but it buys short-term corporate bonds under a year. Because they're corporate bonds, they attract a premium over government bonds. Generally one of the best money-market solutions out there.

Is the best money-market-type ETF. ZST buys corporate bonds under and gets a premium over the typical money market fund. He likes the enhanced yield. In a taxable account, the gains are income. So, there isn't a safe ETF out there.

Invests only in short-term corporate bonds, and it pays out all that income. With this type of vehicle, there should be no expectation of capital gains. If you look at a total return chart, the average gain over 15 years is just over 2%.

Remember that this is money market in an era where money market yields were very low, and went to 0% in Canada, while corporate bonds were trading sub-1%. Very hard to get a positive return for a couple of years after Covid. As interest rates have normalized, the returns there have gotten very compelling.

Corporate debt -- slightly higher risk, so you get a premium yield. No junk bonds. Best-quality corporate bonds in Canada. Some credit risk, but quality holdings make this minimal. Money-market like, very safe, additional yield. It's still the best money market solution for investors looking for a bit of extra yield.