DIY Investors / ETFs

ETFs for parking your money safely

RobH21 Comments

Since my new DIY broker (Questrade) does not support the purchase of high interest savings accounts (HISAs), I need to find a free-to-trade alternative. 5% of my retirement portfolio is invested in what is characterized as “cash”, but I expect that money to earn some sort of return with essentially zero risk. (Another 15% of my portfolio is in the bond market, which, as we all learned in the last few years, has its downsides1.)

Questrade (like Wealthsimple) offers free trades of all ETFs. So it makes sense for me to go looking for ETFs that invest in safe havens. Here’s what I turned up for investments in Canadian dollars, based on some Google searches and some reading of similar questions posted in the public domain. Not all of them are what I would call “equivalent” to a HISA.

Fund SymbolFund CompanyWhat it invests inMERCurrent annual yield2Commentary
CASHGlobal X“high-interest deposit accounts with one or more Canadian chartered banks”0.11%2.68%This invests in the HISAs I currently invest in
CBILGlobal X“short-term Government of Canada T-Bills”0.11%2.88%Not a HISA but a safe investment
HISAEvolve“high-interest deposit accounts”0.15%2.71%Equivalent to CASH but with a higher MER
MCADEvolve“Canadian dollar high-quality short term debt securities (with a term to maturity of 365 days or less)”0.20%3.17%Very short term bond fund. 18% of holdings have due dates of less than 30 days
ZMMKBMO“high-quality money market instruments issued by governments and corporations in Canada, including treasury bills, bankers’ acceptances, and commercial paper. 0.13%3.6%Not a HISA but a very short term bond fund3. 31% of holdings have due dates of less than 30 days.
CAD ETF Candidates for investing Canadian dollars

Based on this quick analysis, ZMMK looks pretty attractive — a lot of very short term (and hence safer) debt as compared to MCAD, excellent returns. It is clearly a riskier investment than something like CASH or HISA. Between CASH and HISA I lean to smaller MERs every time, so CASH wins. CBIL might be a sort of happy middle ground…a T-Bill ought to be as good as a bank. All of these ETFs have a pretty stable NAV, either $50 or $100 per unit, so there should be little to worry about in terms of capital gains.

Since I hold a lot of USD, (not convinced this is a good idea), I need to do the same exercise for USD safe havens.

Fund SymbolFund CompanyWhat it invests inMERCurrent Annual Yield4Commentary
HISUEvolve“primarily in high interest US dollar deposit accounts”0.11%4.05%This invests in the HISAs I currently invest in
HSUVGlobal X“primarily in high interest U.S. dollar deposit accounts with Canadian banks…not currently expected to make any regular distributions”0.2%n/aGlobal X “corporate class” ETFs convert interest payments into capital gains. This sort of ETF makes sense in a non-registered account to minimize taxes.
ICSHBlackRock“broad range of short term U.S. dollar-denominated investment-grade fixed- and floating-rate debt securities and money market instruments”0.08%4.31%Not HISA but 46% is invested in debt with less than 30 days maturity
MUSDEvolve“primarily in U.S. dollar-denominated high-quality short term debt securities (with a term to maturity of 365 days or less).”0.20%3.49%Similar in strategy to ICSH, but only 20% in debt with 30 days maturity and only 40 holdings.
UCSHGlobal X“primarily invests in high-interest U.S. dollar deposit accounts, which provide a higher interest rate than a traditional USD savings account.”0.16%4.08%HISA-like, based on term deposits
USD ETF Candidates for investing US dollars

ICSH is the clear winner in terms of return, but, like ZMMK, a little riskier than a simple bank account. It has a nice broad portfolio (363 individual holdings) which makes it feel safer. HISU looks like the straight-up HISA replacement.

What ETFs do you use to park your cash? Let me know at comments@moneyengineer.ca.

  1. Excellent graphic of historical returns available at https://themeasureofaplan.com/investment-returns-by-asset-class/ ↩︎
  2. Take the latest monthly distribution, divide by the unit price, multiply by 12. If BoC holds their interest rates steady for the year, you could expect to achieve this rate for the next year. As of March 3, 2025. ↩︎
  3. “Commerical paper” refers to very short term debts, 30 days average maturity. Like a credit card debt, maybe. ↩︎
  4. US based funds like this one report a “30 day SEC yield”, it represents “interest earned after deducting the fund’s expenses during the most recent 30-day period by the average investor in the fund”. ↩︎

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21 thoughts on “ETFs for parking your money safely”

  17. […] I’ve been making monthly posts about the current interest rates available via “Series F” High Interest Savings Accounts (HISAs) and HISA-like ETFs for a while now. These are an excellent place to park your money. My current broker, Questrade, gives me access to HISAs, but they are not free to trade, hence of zero interest1 to me — I use HISA-like ETFs instead, some options I uncovered earlier this year are discussed over here. […]

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  18. […] As mentioned elsewhere, I try to keep about 5% of my retirement savings in what I loosely refer to as “cash”. Of course, it’s not cash, cash doesn’t earn any interest, and that would drive me bonkers. Instead, I’ve been using ZMMK and ICSH (two of my ETF all-stars) to serve this purpose. I made a more detailed assessment of available products at the time over here. […]

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