Q: Hello, what do you think the unit price of HSAV will do when the BoC starts cutting rates, maybe in June? Will the unit price drop AND climb more slowly from then on, or not really drop but grow a little slower to reflect the new rates? Thanks
5i Research Answer:
Because interest is not paid out, we would still expect unit value to climb, to reflect the interest income kept. But with lower rates, the rate of growth should slow down, certainly. The fund positions itself short-term, so we with a very gradual decline in rates expected, investors may not notice much overall difference.