We now have a new option for our bond investments. It is called the iUnits Canadian Bond Broad Market Index fund (TSX: XBB) and will track the performace of the Scotia Capital Universe Bond Index. The MER is only 0.30%, interest income will be distributed quarterly and the index currently yields about 4.04%.
I am going to seriously consider the new iBond index fund for the bond portion of our portfolio. Currently, the bond portion of our portfolio is in cash because I am expecting bond yields to rise (and prices to fall). I’ve been wrong so far this year as the SC Universe Index has increased 7.38%. It is a good illustration that market timing rarely works.