He said, “MICs have made returns in times of economic uncertainty like the one we saw in 2020. With Canadian interest rates remaining at historic lows, the target returns offered by MICs to investors can be attractive when viewed as an investment in a portfolio.
“MICs have a low correlation to the broad stock market. Because the MIC is made up of a pool of fixed-rate mortgages with fixed maturities, the rating of a MIC is calculated at different times throughout the year and should show little variation in price between periods.
“A small MIC exposure can improve a portfolio’s return while reducing risk for traditional asset classes like stocks and bonds.”
Given the current environment, the return is attractive. The CMI trio of MIC funds have target returns of between 6 and 11% at a time when retirement income is paramount. Investors can participate with an initial investment of just $ 5,000, which is suitable for RRSP, RRIF, TFSA DPSP, RESP, and RDSP, making them a versatile investment alternative.
CMI’s flagship, MIC, is the CMI MIC Balanced Mortgage Fund, which consists primarily of first and second position mortgages and aims for an annual return of approximately 8.5%. The CMI Prime Mortgage Fund consists of first, second and third mortgages and aims for an annual return of 6%, while the CMI High Yield Opportunity Fund consists of first, second and third position mortgages and aims for an annual return of 10.5%.