Canada is a country that welcomes many new visitors each year. If you’re immigrating to the country, there are many new choices you’ll need to make. One of these choices includes how you should invest your money and plan for your future. Fortunately, there are several different options you can take. You just need to figure out what best suits your needs and requirements.
Exchange-Traded Funds – ETFs
ETFs are an easy way for you to invest your money after moving to Canada. These equity instruments are comprised of securities of various companies, which are usually combined in a specific industry or asset class. For example, if you are interested in diversifying your portfolio to include the semiconductor industry, you could buy an ETF that includes several semiconductor companies. These have lower management fees than mutual fund investments and are traded just like stocks, which makes it easier for you to buy and sell them.
Mutual funds can be similar to ETFs as they are mainly focused on specific industries or indices. You’re able to invest in mutual funds focused on sectors such as technology or housing or indices such as the SPX. A manager or team will select the companies that are placed in a mutual fund. When you need to invest your money and still have it in another country, you can always transfer money to Canada online to fund the mutual accounts you want to utilize.
Guaranteed Investment Certificates – GICs
You can also choose to invest in a GIC, which means you’ll be loaning money to a credit union, trust company or bank. The institution you choose will pay you income based on a specific interest rate. GICs offer protection as they are insured up to $100,000. You’ll find GICs with the term of five years or less. This type of investment is not redeemable, which means you won’t be able to take your principal out before the maturity date. You’ll find GICs available for several investment periods, which might be as short as 30 days or as long as five years. You’ll receive a higher interest rate if it takes longer for your GIC to mature.
Another great way to invest when you live in Canada is by diversifying your portfolio with individual stocks. By opening up a brokerage account, you’re able to perform research on individual companies and buy the stocks that are associated with each of them. This type of investment can be a little riskier if you are placing your money with just one company in a specific sector. However, the gains can be higher than those you receive from a mutual fund or ETF that has its risks spread between several different companies. Sometimes, you need to take a little more risk if you want to achieve higher gains.
By utilizing various avenues of investing, it helps ensure you’ve got a diversified portfolio, which can provide you with extra money in the future when you need it to retire.