Gauranteed Investment Certificates work in somewhat the same way as bonds, you buy the certificate from a bank and you recieve payments of interest off of your intitial investment. These can be given out as the investor chooses from either once a year to multiple times a year. Also as the name implies your initial investment is gaurenteed from the bank so there is really no risk involved other than the bank going under which is very unlikely with a stable economy. Another similarity to bond is that most GIC's have a fixed period of time for the investment to mature or for you to get your money back. There are GIC's that allow investors to collect their money as needed but they are also accompanied by lower interest rates. Investment times for these can range from less than a year up to ten years. Interest rates on these investments can range from around 1 percent in the first year up to roughly four percent by the fifth year.
This is just a quick summary of what GIC's are, for more information or if you want to buy one of these investments you can contact any large bank, or if you have any questions please leave a comment and I will get back to you ASAP.
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