Consumers
Students
An account held with a financial institution
Safe vehicle for short-term savings of any amount
High liquidity (easy to cash)
Canada Savings Bond (CSB)
A special type of bond issued by the federal government, purchased through financial institutions
Available only at specific times
Pay a fixed interest rate, subject to periodic adjustment by the government
Safe, guaranteed by the government and highly liquid (although the new Canada Premium Bond is only cashable once a year on its anniversary date)
Unlike other bonds, cannot be traded
Available in various amounts and for as little as $100
Government Treasury Bill
(T-Bill)
Short-term investment: terms of one month to a year (considered a cash-equivalent)
Safe, government-backed
Don't pay a specified interest rate, rather T-Bills have a face value; you purchase them at a "discount" (less than the face value) and then redeem it at face value; the difference is your return
Available in different amounts starting at $1,000
Can be purchased from most financial institutions
Term Deposit / Guaranteed Investment Certificate (GIC)
Term investments offered by financial institutions for a set period
Terms range from less than a month to 10 years.
New "market-linked" GICs guarantee principal, but returns are linked to some stock market index
Terms range from less than a month to 10 years
Available in various amounts
Bankers' Acceptance (BA)
Short-term debt issued by corporations that is guaranteed by a bank
Highly liquid (terms to maturity of less than a year)
Considered safe, low-risk
Purchased at a discount on the "face value", the amount you will receive when the debt matures
Offer a fixed return, based on the difference between the discounted purchase price and the face value
Largely used by high net worth individuals, as they are typically available in amounts of $100,000 and up
Commercial Paper
Similar to BAs, but without the guarantee of a bank
Available through financial institutions
Government Bond
Issued by the federal and provincial governments and available through most financial institutions
Set at fixed interest rate, for a specified term
Safe (guaranteed to maturity by the issuing government) and liquid
Come in terms of one to 30 years
Can be sold in the bond market before maturity
Corporate Bond
Issued by a corporation and available through a brokerage house
Set at fixed interest rate, for a specified term
Backed by specific assets of the issuing company
Come in terms of one to 30 years and in various types
Can be sold in the bond market before maturity
Debenture
Type of corporate bond, but not secured by specific company assets. Simply based on the general reputation of the issuing company.
Mortgage-Backed Securities
Fixed-rate investments that represent an ownership share in a pool of mortgages insured by the federal government's Canada Mortgage and Housing Corporation
Minimum investment of $5,000; terms range from one to 10 years
Receive a monthly payment that is a blend of principal and interest accruing from the pool of mortgages
