Yearning for yields? Why GICs beat five-year government bonds - GIC Wealth Management

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Yearning for yields? Why GICs beat five-year government bonds

Why are yields on five-year guaranteed investment certificates (GICs) so much higher than yields on five-year government bonds, when both have the same term and would appear to have the same level of risk?

GICs do indeed yield more than bonds – a lot more. When I compared GIC rates on Globeinvestor.com this week (scroll down the page at tgam.ca/personal-finance), the top five-year yield was 2.95 per cent, offered by Hubert Financial, the online division of Manitoba-based Sunova Credit Union.

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