Guaranteed Investment (Interest) Certificate (GIC)
A deposit investment security sold by Canadian banks and trust companies. They are often bought for retirement plans because they provide a low-risk fixed rate of return. The principal is at risk only if the bank defaults. Investopedia Says:
The bank's profit is the difference between mortgage rates and GIC rates. If mortgages are at 8% and GICs are at 5%, then the bank makes 3%.
GICs offer a return that is slightly higher than T-bills. Related Terms:
Bullet GIC
T-Bill
Term Deposit Guaranteed Investment Contract (GIC)
Insurance contracts that guarantee the owner principal repayment and a fixed or floating interest rate for a predetermined period of time. Investopedia Says:
Guaranteed investment contracts are typically issued by insurance companies and marketed to institutions that qualify for favorable tax status under federal laws. These products provide institutions with guaranteed returns. Related Terms:
Institutional Investor
Interest
Life Insurance
Principal |