BMO Short Corporate Bond ETF
ZCS (TSX)
The BMO Short Corporate Bond ETF (ZCS) emphasizes a strategy focused on short-term corporate bonds, earning a Silver Morningstar rating for its quality and efficiency in this asset class. With a dividend yield of approximately 3.59%, it offers investors a safer alternative that can potentially enhance returns compared to traditional cash holdings. While the 1-year return stands at 1.74%, investors should note the longer-term 5-year performance, which has seen a decline of 3.56%.
Pros:
- Focuses on short-term corporate bonds
- Highly rated for quality and efficiency
Cons:
- Negative 5-year return
- Market volatility risk
The BMO Short Corporate Bond ETF (ZCS) may be suitable for conservative investors seeking a relatively stable income stream through short-term corporate bonds while prioritizing capital preservation over aggressive growth. However, potential investors should carefully consider the ETF's longer-term performance metrics, particularly the negative return over the past five years, before making a commitment.