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BMO Aggregate Bond Index ETF (ZAG)
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iShares Convertible Bond Index ETF (CVD)
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iShares Core Canadian Long Term Bond Index ETF (XLB)
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Pender Corporate Bond Fund Class F (PGF510)
Q: I have these bond funds: PGF510, CVC, ZAG, XLB, along with mostly GIC's in my fixed income side of portfolio. Do these Bond funds pay interest the same as the GIC's or do they pay Dividends so I would get the Dividend Tax credit? All are in my margin account. Would any of these be worth adding to now that they have gone up somewhat? Thanks so much!
5i Research Answer:
Funds 'pass through' tax consequences to unit holders. Since these all hold bonds, income is taxed as interest and the dividend tax credit does not apply. We would be fine adding to any of these, but CVD likely has the most upside in a lower rate environment.