$USD Canada Based Savings Account | General financial discussion | Discussion forum

Hi Stephen,

I feel compelled to correct Joe's quoted text in your post. TDB8152 is not, specifically, a money market fund. It's a common and easy mistake to make, though, since it appears on your brokerage statements as a "money market", "cash equivalent", etc., and because it has a fund code like mutual funds and money market funds. However, money market funds are not CDIC insured and, while they do tend to maintain a constant Net Asset Value (NAV), it's not guaranteed. The returns on money market funds are sub 1%, typically, so it's typically not worthwhile. As well, in a money market fund, you are pooling your money together into a fund with other investors.

TDB8152, by contrast, is an investment savings account. It's true that the funds may not be set up in a separate numbered account in your name (they're not), but the financial institution still has to report the beneficial owner (your brokerage firm or trust company, in the case of non-registered accounts) to CDIC and your brokerage firm has to report to the firm and/or CDIC the names of its clients which hold that product. This is how nominee form savings accounts work. The reason it has a fund code is because it trades, at the end of the day, through the FundSERV platform used by brokerage and financial advisory firms.

Cheers,
Doug

I gave up on TDB8152 as well.

Using CIB483 nowadays. Yield is better but usual caveats apply.

edit: bought CIB483 through my usual account at TDDI.

Joe said
I have been using TDB166, USD money market fund.....no charges in/out, yield is now 1.53%.....it was over 2% a few months ago.  

TDB8166 (https://www.td.com/ca/en/asset-management/funds/solutions/mutual-funds/FundCard/TD U.S. Money Market Fund (US$) - I?fundId=30) is an example of a USD money market mutual fund in that it is a mutual fund that holds a basket of very short term fixed income securities in cash and investors hold, indirectly, an interest in said securities proportionate to their holding of units of the fund. The MER is ~0.50%, but since it does maintain a constant net asset value, this is less of a concern. As well, money market funds are even more susceptible to the bond market movements, so if rates fall, the yield may fall at an outsized rate in comparison to GIC rates. Not a huge deal, but something to be aware of.

TDB8152 identified above, though, is a broker-held investment savings account with a fundcode, not a money market fund.

Cheers,
Doug

If one has an adviser, whom one is paying separate fees to, the Series F units of the Bank of Nova Scotia US$ ISA (DYN6005) are currently yielding 1.10%.

Otherwise, the Series A units (DYN6001) pay 1.0% for balances of US$100,000 or more. For balances under US$100,000, the rate is 0.85%.

Joe said
This may be of interest to those with a USD trading account.

https://seekingalpha.com/article/4315217-investment-where-to-park-cash-and-get-yield?app=1&isDirectRoadblock=false&utm_medium=email&utm_source=seeking_alpha  

Thanks much for the link. I was aware MINT was the 'go to' but first time I have seen this depth of analysis. Seriously going to consider this for USD currently earning about 0.85%. Have to do the math on cost of amortizing 2 $10 commissions first.

Jowett said

Thanks, I tried entering as you suggested, it worked as far as "preview order" but then regected due to my USD cash optimum a/c is limited to bonds, fixed inc mutual funds and money market funds.
I suppose I will have to put aside the afternoon to trying to reach them by phone.

I was able to preview my order. But, I was using one of my cash accounts.

As AltaRed wrote, I tried with my Cash Optimizer account and got this error when I tried to preview my order:

Trading in the cash optimizer investment account is limited to bonds, fixed income mutual funds and money market mutual funds. For further assistance, please call customer service.

Contact Scotia iTRADE to see if it is intentional.

It is possible that someone just missed adding the Bank of Nova Scotia ISA's and the ADS Canadian Bank ISA's to the list of allowed products for the Cash Optimizer account.

One could open a Cash account. As long as one has "total account equity at Scotia iTRADE greater than $10,000", their $25/quarter per account Low Activity Account Administration Fee is waived.

I am aware of the USD GICs at Scotia iTrade. Not willing to commit USD cash that long.

As for the ETFs, I fully understand the nature of the beasts. Duration is a key number and is pretty high for MINT at 0.48. I'd expect cash equivalent to have duration of about 0.083 (30 day commercial paper) or maybe upwards of 0.12 that holds 3 month T bills or in the case of FLOT and FLRN, floating rate ST notes, options, etc. None of that is true cash of course.

Regardless, the Seekng Alpha materials do provide some clarity on choices. Nothing comes for free.