Q: Can you explain the differences between money market funds PSA and CIB238? Which generally provides the better rate of return? Looking for somewhere to park money when not in use. Which would you recommend?
5i Research Answer:
Money market funds, such as CIB238 are mutual funds, which differ from PSA which is an ETF.
CIB238 has an MER of 0.19%, a minimum investment of $100,000, and it pays a yield of roughly 4.8%. This fund invests in money market instruments such as short-term bonds issued by various corporations and levels of the government.
The Purpose High Interest Savings ETF (PSA), on the other hand is an ETF which does not have a minimum investment amount. It invests in high-interest savings accounts with the major 6 Canadian banks. It has an MER of 0.15% and a yield of 3.4%.