If both of those investments have been held in registered accounts, similar to a TFSA or a Registered Retirement Financial savings Plan (RRSP), then their good points could be sheltered from paying taxes.
The principle similarity between GICs and mutual funds is that they will each be held in registered or non-registered accounts. Each investments are available in a number of differing kinds, permitting buyers to decide on one or any mixture of them to go well with their liquidity wants, funding targets, and threat urge for food.
As an example, you possibly can go for a market-linked GIC that may provide the perfect options of GICs and mutual funds. A market-linked GIC can probably present larger potential good points because it’s tied to the inventory market. It additionally provides you the safety of getting your a refund – simply in case the market performs poorly.
In the meantime, you possibly can select to spend money on mutual funds from massive banks – the Royal Financial institution of Canada’s mutual funds, for instance – or different monetary establishments. One such mutual fund that may give good returns and relatively decrease threat is the cash market mutual fund.
GICs are a extra applicable choice in the event you’re searching for a safe funding that has assured returns. That is good for buyers who’re extraordinarily risk-averse and like to not, or just can not afford to, lose any of the cash they make investments.