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What is a market-linked GIC?
Like other types of GICs, a market-linked GIC has a set term, usually between one and five years, and the principal is guaranteed. Unlike standard GICs, however, the rate of return on a market-linked GIC is tied to the performance of a stock market index or a basket of stocks.
The performance of the stocks or indexes that the GIC is “linked” to, determines the rate of return. But no matter how the stock market performs, at a minimum, you’ll get your principal – or the full amount you originally invested – back at maturity.