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GICs 101: When is a guaranteed investment certificate worth investing in? – The Globe and Mail



Illustration by Melanie Lambrick

GICs have been in the news in 2022 as interest rates rise in response to inflation. In fact, there has been a surge in demand for GICs thanks to favourable rates that might just be the best in more than 20 years. But what is a GIC, how does it work, and is it the right choice for your investments?

What is a GIC?

GIC stands for guaranteed investment certificate. It’s an investment tool whereby you lend money to a bank or other financial institution for a specific duration of time (the “term”) in order to earn interest. GICs can have either fixed or variable interest rates, and in general, the longer the term, the higher the rate. Depending on the product, interest might be paid out monthly, annually, at maturity (the end of the term) or on another time frame.

GICs are considered a safe investment – unlike with stocks, you don’t risk losing your money. And even if something were to happen with your bank, the federal government – through the Canada Deposit Insurance Corp. (CDIC) – guarantees the GIC’s combined principal and interest payments up to $100,000.


Where can GICs be purchased?

You’ve probably seen ads for GICs from the big banks, but while they’re a major seller of these products, they’re not the only place to buy. Numerous other financial institutions such as trust companies, smaller banks and credit unions offer them as well. It’s often worth shopping around for the best options before you buy – don’t be surprised to find higher interest rates outside your regular bank.

A note about insurance: Through the CDIC, GICs from banks and trust companies are insured up to $100,000; GICs from credit unions and caisses populaires are insured provincially.

How do GICs work?

In some ways, GICs seem like a savings account – you leave some money in the bank and it pays you a percentage in interest. The major difference is in liquidity. Most GICs are non-redeemable, meaning you’re committing that money to the issuer for a specific period of time. If you put $5,000 into a five-year GIC, for example, that $5,000 is locked in until the five years are up.

Non-redeemable GICs are hard, if not impossible, to cash out of before maturity. If there is a way to exit early at all, you should expect a penalty fee. However, there is an alternative for investors who need liquidity: the cashable GIC. You won’t get the same rates as with a standard GIC, but you might still be able to beat the rates on high-interest savings accounts.

You can hold a GIC inside a registered account such as a tax-free savings account, registered retirement savings plan or registered retirement income fund, or in a non-registered account.

What is a market-linked GIC?

Market-linked guaranteed investment certificates are promoted by sellers as offering the best of both worlds: the guaranteed income and lack of risk standard in a GIC plus the promise of more earnings should the stock markets perform well. Interest rates are lower than regular GICs, though, and unlike with stocks, your principal is locked in for an entire term.

Rob Carrick, The Globe and Mail’s personal finance columnist, is not a fan of these products. “They are financially engineered to produce profit for the bank while paying investors returns that could easily be worse than a regular GIC,” he says. “The latest spin on this product is GICs linked to the performance of socially responsible companies. Socially responsible banks would kill these products dead.”

What are some pros and cons of GICs?

The biggest pro is in that G: guaranteed. GICs are considered a safe investment choice for people who can’t – or don’t want to – take risks with their money.

The downside that comes with that, though, is that the money is usually locked in, meaning it’s not liquid – you can’t take it out if you need it without paying a penalty. Not having access to the money is its own kind of risk, depending on your situation, and you might also be missing out on opportunities to earn higher interest (should rates go up) or better returns via a different investment vehicle.

‘Laddering’ investments and auto-renewals: Tips for investing in GICs

If you’re thinking of putting some money into GICs, it’s a good idea to look at both interest rates and terms. Typically, the more years you lock in your money for, the higher the interest rate. That makes it tempting to pick a longer term, but it might not be the best choice, notes John Heinzl, who writes The Globe’s Investor Clinic column: “If interest rates continue to rise – as many economists expect – you’ll be stuck collecting the same yield for the next five years.”

One way to deal with this is “laddering,” a way of distributing your GIC investments so you have access to some of your money every year and can take advantage of rising interest rates. (Laddering also exposes you to falling interest rates, but that doesn’t seem to be in the cards right now.)

Mr. Heinzl suggests laddering your GICs across terms of, say, one, two and three years. When the one-year GIC matures, reinvest the cash in a new three-year GIC. A year later, do the same with the proceeds of the maturing two-year GIC. And so on.

Another thing to watch for is auto-renewals. While some GIC sellers will contact customers at the end of a term to find out what they want to do with their funds, others are automatically renewed upon maturity, meaning your money will be locked in for yet another term.

The danger of auto-renewals lies in forgetting about your maturing GIC. Imagine having a five-year GIC auto-renewed a year ago for five years, just as it started to become clear that rates were headed higher as a result of stubborn inflation. A one-year term would have been a good call.

Or, you might find better rates at another bank or credit union and want to transfer your maturing money there. Some GIC issuers are consistently competitive with returns, while others may rarely or intermittently offer strong rates.

Before buying, ask whether your GIC will be automatically renewed on maturity unless you say otherwise. And make a note somewhere to get in touch with your GIC issuer a month or so ahead of maturity to provide instructions.

Are GICs worth investing in?

If you’ll be needing your money to make a major purchase in the next few years, says Mr. Heinzl, or if you can’t tolerate any market volatility, then by all means consider GICs for the certainty they provide. But if you’re investing for the long run, you may be better off looking at stocks or exchange-traded funds, which have a long track record of beating inflation, albeit with more volatility along the way.

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CPP Investments Anchors New IndoSpace Fund with US$205 Million Investment – Yahoo Canada Finance



MUMBAI, India, Jan. 30, 2023 /CNW/ – Canada Pension Plan Investment Board (CPP Investments) today announced an investment of US$205 million as an anchor investor in IndoSpace‘s new real estate fund. IndoSpace is a leading real estate company in India. The investment marks the first close for IndoSpace Logistics Parks IV (ILP IV), the company’s fourth development vehicle, targeting US$600 million of total equity commitments.

Image of sites (CNW Group/Canada Pension Plan Investment Board)

Image of sites (CNW Group/Canada Pension Plan Investment Board)

This is the latest venture between CPP Investments and IndoSpace. The first joint venture, IndoSpace Core, was established in 2017 and now owns the largest portfolio of stabilized modern logistics assets in India. CPP Investments has also invested in ILP III. Following the investment in ILP IV, the partnership will exceed US$1 billion in assets.

ILP IV will add an additional 25-30 million square feet to the IndoSpace portfolio, furthering IndoSpace’s leading position in the Indian market. ILP IV will focus on India’s largest logistics real estate markets: Ahmedabad, Bangalore, Chennai, Delhi, Hyderabad, Kolkata, Mumbai, and Pune. The establishment of ILP IV follows on from the first three development funds, which have a combined total of 56 million square feet of modern logistics real estate in India.


Hari Krishna V, Managing Director, Head of Real Estate India, CPP Investments, said, “Over the past few years, we have made numerous investments in India’s industrial space, where we see strong demand as the manufacturing sector continues to grow and the e-commerce sector matures. We are pleased to be working with our longstanding partner IndoSpace to further capitalize on opportunities in this space and believe this investment will deliver strong risk adjusted returns for CPP contributors and beneficiaries.”

Brian Oravec, Managing Partner and CEO, IndoSpace Capital Asia, said, “We are excited to extend our successful partnership with CPP Investments. CPP Investments’ commitment to ILP IV is a testament to IndoSpace’s leadership in the industrial and logistics real estate space in India. ILP IV will allow us to continue to expand our unique national network to better serve our customers. Industrial and logistics infrastructure is a key enabler of economic growth. To meet India’s aim of becoming a US$5 trillion economy by 2025, IndoSpace is excited to continue to be one of India’s key infrastructure creators.”

About CPP Investments

Canada Pension Plan Investment Board (CPP InvestmentsTM) is a professional investment management organization that manages the Fund in the best interest of the 21 million contributors and beneficiaries of the Canada Pension Plan. To build diversified portfolios of assets, investments are made around the world in public equities, private equities, real estate, infrastructure and fixed income. Headquartered in Toronto, with offices in Hong Kong, London, Luxembourg, Mumbai, New York City, San Francisco, São Paulo and Sydney, CPP Investments is governed and managed independently of the Canada Pension Plan and at arm’s length from governments. As per September 30, 2022, the Fund totalled C$529 billion. For more information, please visit or follow us on LinkedInFacebook or Twitter.

About IndoSpace

IndoSpace ( is the largest investor, developer, and operator of grade A industrial and logistics real estate in India. IndoSpace has the largest national network of 50 logistics parks with 56 million square feet delivered/under development across 10 cities. With India’s largest and most experienced industrial real estate team, IndoSpace continues to lead the development of key logistics infrastructure for India’s economic growth. For more information, visit and follow us on LinkedIn, Twitter, and Facebook.

CPP Investments logo (CNW Group/Canada Pension Plan Investment Board)CPP Investments logo (CNW Group/Canada Pension Plan Investment Board)

CPP Investments logo (CNW Group/Canada Pension Plan Investment Board)

IndoSpace logo (CNW Group/Canada Pension Plan Investment Board)IndoSpace logo (CNW Group/Canada Pension Plan Investment Board)

IndoSpace logo (CNW Group/Canada Pension Plan Investment Board)

SOURCE Canada Pension Plan Investment Board



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Zacks Investment Ideas feature highlights: Meta Platforms, Alphabet, Snap, Oracle and Global Social Media ETF



For Immediate Release

Chicago, IL – January 30, 2023 – Today, Zacks Investment Ideas feature highlights Meta Platforms META, Alphabet GOOGL, Snap Inc SNAP, Oracle ORCL and Global Social Media ETF SOCL.

TikTok Ban Coming: 3 Stocks That Would Benefit

The Social Media Landscape Is Evolving

The social media landscape has changed dramatically over the past few years with the rapid ascent of the personalized video platform app TikTok. Despite TikTok’s rapid rise, Meta Platforms and Alphabet are still the dominant players. In terms of monthly active users, three Meta platforms make up the top four rankings globally: Facebook (#1), Whatsapp (#3), and Instagram (#4).

Alphabet holds the second spot with its video platform Youtube and TikTok is ranked #6. Even with the continued dominance of existing players like META and GOOGL, stock performance has been lackluster in recent years. The Global Social Media ETF is the most followed social media ETF (note that it does not include TikTok).

What has Led to the Underperformance of Existing Players?

For one, Meta CEO Mark Zuckerberg is paying less attention to his lucrative social media business and instead investing valuable resources in what he sees as the future – the metaverse. Approximately 20% of Meta’s current investments are aimed at this project. While the bold bet has not panned out for Zuckerberg and Meta yet, he plans to stay the course.


The other major factor leading to the underperformance in domestic social media platforms such as Instagram, Youtube, and Snap Inc’s Snap Chat platform is TikTok’s success.

Chinese-based ByteDance launched TikTok in the United States in 2016, and since then, the platform has dominated. The app, which allows users to create and modify short-form videos, has caught on, especially with the younger generation. TikTok’s competitors have noticed. To win eyes back, Instagram has launched “Reels” and Youtube has created “Shorts” –aimed at users who prefer short, customizable videos like Tik Tok.

SnapChat, already in the short video space, has suffered the most from TikTok’s rise.

National Security Concerns

Though TikTok is one of the dominant global social media players and shows little signs of slowing growth – other factors may play a significant role in the social media space moving forward. Concerns are growing that ByteDance is collecting unnecessary personal data on its users and possibly supplying it to the Chinese government (the biggest rival of the U.S.).

Former President Donald Trump attempted to ban TikTok in 2020, but ultimately the app was able to remain active. The Biden administration struck down the potential Trump ban on TikTok but ordered a national security investigation.

A Potential Catalyst for Domestic Social Media Platforms

Even with the failed TikTok bans of the past, momentum is growing for a new possible attempted ban. In the past year, FBI director Christopher Wray, FCC Commissioner Brendan Carr, and Senator Josh Hawley have called for a domestic TikTok ban. Meanwhile, several U.S. colleges have implemented their own bans (via WiFi) amid security concerns.

Tuesday, Josh Hawley announced he would introduce a bill to ban the app. Investors who follow the social media space should keep a close eye on how the efforts to ban the app play out. If the app is ultimately banned, SNAP will benefit the most, along with META and GOOGL. Software giant Oracle, which supports TikTok via its cloud platform, would stand to lose.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit for information about the performance numbers displayed in this press release.

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Meta Platforms, Inc. (META) : Free Stock Analysis Report

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ChatGPT explains Warren Buffett's investing strategy, names stock picks – Markets Insider



  • Insider’s Phil Rosen asked ChatGPT to explain Warren Buffett’s investing strategy.
  • The viral language tool shared how value investing has given Buffett an edge, and broke down his best investment decision.
  • The bot also named two potential stocks that would align with Buffett’s strategy. 

ChatGPT, whose parent is getting a $10 billion investment from Microsoft, has shown its competence in writing stock stories, dating-app messages, and even an email announcing layoffs

As it turns out, OpenAI’s viral language tool fared well in its breakdown of Warren Buffett’s investing approach, too. 

I asked ChatGPT to explain the Oracle of Omaha’s most important strategy that helped him reach his legendary billionaire status, and within seconds the bot spat out an analysis of value investing.

“Warren Buffett’s most important investing strategy is value investing, which involves identifying undervalued companies with strong potential for growth and a durable competitive advantage, and then holding onto those investments for the long-term,” ChatGPT said. “He also follows a principle of investing in businesses he understands, with a focus on companies with predictable earnings and a strong track record of increasing profits.”

That said, when I inquired what Buffett’s most important decision has been in his career, ChatGPT pointed to his investment in Berkshire Hathaway decades ago. Buffett “transformed it into a holding company and used it as a vehicle to make a series of successful investments and acquisitions,” the bot said.

ChatGPT’s stock picks for Buffett

To fully carry out the interrogation, I tasked ChatGPT with naming stocks that Buffett could add to his portfolio. 

While the bot doesn’t have access to real-time markets data and its knowledge only goes up to 2021, it had plenty of historical intel to work with, given Buffett’s long career. 

It named PepsiCo and Unilever as stocks that would make sense for Buffett to invest in, given they’re consumer goods companies with strong brand recognition and consistent revenue growth. Buffett famously consumes five cans of Coke a day, but he had been a Pepsi drinker for nearly 50 years before that.

As for Unilever, Buffett had come close to sealing a deal on the company along with Kraft Heinz in 2017, but it eventually fell through.

ChatGPT also named Amazon, which Buffett already owns, and Microsoft, which Buffett owns an indirect stake in via ownership of New England Asset Management, as two examples of blue-chip companies with a track record of innovation.

Then it listed Johnson & Johnson and Pfizer — Buffett owns the former, and has previously owned the latter — as two stable healthcare options that would fit Buffett’s strategy.

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