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Email this2:17 pm
January 18, 2013
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This is not about bank accounts.
This is an area that many investors overlook. They have spare cash sitting in their brokerage account getting not a penny in interest. By buying a HISA fund they can get about 1.6% (I think, though it seems impossible to really tell thanks to their bizarre, uninformative website). As its secure its treated as cash by the brokerage firm. Most stock buys require a 2 day settlement. Some funds have an early withdraw fee.
RBC has these funds for self directed individual investors @ 1.6%. Each is CDIC insured up to $100,000. So buying all 4 gives you $400,000 in coverage.
RBF2010, RBF2020, RBF2030, RBF2040
But if you go on to RBC's horrendous website you will find it almost impossible to get information on these things. Not sure why they don't have information clearly displayed in tables like everything else.
There are many other funds out there that do the same thing. I'm looking for (obviously) the highest interest possible on a fund I can own for just 1 day. Suggestions? Where to look? It seems to be very hard to find this info online.
7:07 pm
October 21, 2013
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I'm curious why you think these four would all be covered by CDIC, to 400K. They would have to be different issuers, I think, and maybe they are?
TDDI's equivalent funds are only paying 1.35% - at least they were through October.
7:24 pm
April 6, 2013
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Yes, they have different CDIC issuers. From the fine print of the RBC Royal Bank document RBC Investment Savings® Account: Gain the best from both worlds: savings and security, these are the issuers:
- Royal Bank of Canada RISA Series A (RBF2010) and Series F (RBF2011) and U.S. RISA Series A (RBF2014) and Series F (RBF2015)
- Royal Bank Mortgage Corporation RISA Series A (RBF2020) and Series F (RBF2021)
- Royal Trust Corporation of Canada RISA Series A (RBF2030) and Series F (RBF2031), and
- The Royal Trust Company Series A (RBF2040) and Series F (RBF2041)
7:51 pm
April 6, 2013
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The current rate sheet for them is at RBC Investment Savings Account.
The current rates, effective October 26, are as follows:
| Series | Fund Codes | Interest Rate |
| Series A | RBF2010, RBF2020, RBF2030, RBF2040 | 1.60%* |
| Series F | RBF2011, RBF2021, RBF2031, RBF2041 | 1.85%* |
10:58 pm
August 4, 2010
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These brokerage ISAs are generally all the same. They are CDIC insured, offered through FUNDSERV, and settle T+1. There's often an F-series, but the brokerages offer the A-series, and pocket the 25 basis points "advisor fee" for their troubles. The interest rate is usually identical across almost all the financial institutions, and is currently 1.60% (1.85% on the unavailable F-series). There is usually a $500 or $1000 minimum initial purchase, and often a smaller minimum such as $100 for subsequent additions (although the brokerages may adjust these) and there may be a maximum holding (in the millions).
The bigger players often have multiple CDIC issuers (RBC has 4, as does TD). Some may offer a $US-denominated ISA, which won't be CDIC insured. Credit unions (provincially chartered) aren't in the game. Brokerages associated with ISA issuers may often only offer their "home team" ISAs, or a very limited number of competitors.
Here is TD's ISA list (current rate 1.60%): https://www.td.com/ca/en/asset-management/additional-solutions/
Here's info for Equitable (https://www.equitablebank.ca/hisa) and Home Trust (the Oaken people, it was hit hard during their deposit run:
https://www.hometrust.ca/deposits/hisa/). Manulife (https://repsourcepublic.manulife.com/wps/portal/Repsource/Products/Banking/InvestmentSavingsAccount/ISA) in the past would often have there Trust issuer at 5 or 10 basis points higher than the others, but both of theirs are 1.60% as well. CIBC's are under the name Renaissance (https://www.renaissanceinvestments.ca/en/products/hisa.asp)
Anyone sufficiently interested can Google the rest (Scotia, etc), but they are pretty much cookie-cutter types of things.
6:34 am
November 19, 2014
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I use these things a fair bit. My only caveats would be:
- remember they trade as mutual funds and unlike stocks, they trade only once per day, after the markets close at 4, so remember that when you are putting orders in.
- you can have the monthly return posted to your account as cash or "dripped" as more units of the fund. plan accordingly.
7:58 am
August 4, 2010
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Also, the standard boilerplate that these are separate CDIC quotas (they are nominee/street name trusts) - each brokerage/issuer pair has a separate $100,000 coverage. So Jane Smith could have $100K of RBF2010 at Questrade (assuming they offered it), and another $100K of the same thing in her RBCDI brokerage account, and both would be covered. And neither would affect her $100K coverage in a regular RBC bank account through her branch.
3:50 pm
October 27, 2013
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Koogie said
- remember they trade as mutual funds and unlike stocks, they trade only once per day, after the markets close at 4, so remember that when you are putting orders in.
Agree they only trade once a day BUT the price is fixed at either $1* or $10 per unit depending on the provider. However, like mutual funds, the order has to be in by a certain time in order to have settlement by closing the next day, They are a good way to hold cash without having to jump through hoops with external transfers. Still a good way to access cash to pay for a stock or bond purchase with a T+2 settlement date.
* Scotia and BMO price their units at $1/unit. As already mentioned, the CAD units pay the same interest, although some brokerages will lag others by up to a week or two with rate increases.
Added later: We don't need a comparison chart on these. In most cases, brokerages insist on using their own in-house ISAs anyway.
7:37 am
December 27, 2016
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Anyone has experience in buying the US dollar ISA at discount brokerages? I heard it's just like deposits and won't be taxable on the FX fluctuations. However, will it not show up on T5008 as one of the "tranactions" when selling? If so, then it needs to be reported on T3, no?
10:21 am
October 27, 2013
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Buzz said
Anyone has experience in buying the US dollar ISA at discount brokerages? I heard it's just like deposits and won't be taxable on the FX fluctuations. However, will it not show up on T5008 as one of the "tranactions" when selling? If so, then it needs to be reported on T3, no?
The US dollar ISAs are considered 'deposit' products like bank accounts and thus do not incur taxable forex gains or losses "on their own" when sold. It should not be reported on a T5008, but even if it is, ignore it. CRA understands what these products are and it is not necessary to include on your Schedule 3 (Capital Transactions). A T5 will be issued annually for any interest earned each year however for reporting on Schedule 4.
However, separate from that noted above, please remember that does not absolve you from keeping track of the CAD equivalent ACB of your USD (whether as cash, savings account, or ISA or MMF). When/if any of that USD is used to purchase something else such as a stock or bond or MMF, it will trigger a forex capital gain/loss at that time.
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