BMO Aggregate Bond Index (ZAG-T)

He likes, and it charges only five basis points. But it has a long, five-year duration. Don't hold this on its own; also have shorter-term ETFs to deal with interest rate moves.

A fund of bond funds. It is really cheap. It is an actively managed ETF. It is a viable place to go. He has never liked preferred shares. But then he changed his mind a year and a half ago. He would take a look at them now in some accounts.

Fixed income or bond ETF? When he talks about bond ETF’s, he begins with what he thinks of as the core holdings. The core holdings will be the most liquid with the lowest fees and access to the whole market. These are for long-term Hold positions. The asset class he favours is aggregate bonds, a mix of government and corporate. In Canada, there are a good number of them. This Index recently had its fee dropped, and he believes it makes them the lowest cost one in Canada. A long-term aggregate Bond ETF, and will have duration risks, so if there are rate movements in Canada, it could suffer. He thinks Aggregate Bonds are the way to go. Dividend yield of 3.1%.

(A Top Pick June 3/16. Up 1.36%.) When looking for yield in the summer, you want to shy away from the cyclical sector, and go towards these defensive assets. Fixed income products tend to do well. From May through to September/October, bonds tend to do well.

You want to lower your beta, and this holds both corporate and government bonds. The yield is about 3%. It broke out recently at about $15.90, and the trend is clearly positive.