NoteHub

Principal Protected Notes (PPNs) in Canada

Principal protected notes (PPNs) guarantee the return of your full investment at maturity, regardless of the underlier's performance. If the underlier finishes positive, you participate in the gains at a specified rate. If it finishes negative, you receive your full principal back.

Return Profile

-60%-40%-20%+0%+20%+40%+60%Underlier Return-0%+10%+20%+30%+40%+50%+60%Note ReturnNote ReturnUnderliernotehub.ca

For illustrative purposes only. Actual returns depend on specific note terms.

How It Works

1

Your full principal is guaranteed when held to maturity, regardless of market performance during the term.

2

If the underlying asset finishes positive, you receive your principal plus the gain at the specified participation rate.

3

PPNs can be linked to a variety of assets - indexes, ETFs, commodities, or baskets of stocks - providing diversified exposure.

4

Unlike GICs, you can sell PPNs before maturity on the secondary market. However, the principal guarantee only applies at maturity.

5

PPNs are issued and backed by the issuing bank. They are eligible for RRSPs, RRIFs, RESPs, TFSAs, and FHSAs.

Investor Suitability

  • Want market exposure without any risk to your original investment
  • Willing to accept lower participation rates in exchange for full principal safety
  • Comfortable with longer holding periods (typically 3-7 years)
  • Medium- to long-term investment horizon
  • RRSP, RRIF, RESP, TFSA, and FHSA eligible

Investment Considerations

  • Does not pay income - not suitable if you need regular cash flow
  • Principal guarantee only applies if you hold to maturity
  • Participation rates may be lower than owning the underlying asset directly
  • Payments depend on the issuing bank's creditworthiness
  • Selling before maturity on the secondary market may result in a loss
  • Early trading fees may apply
  • Taxed as interest income outside registered accounts
  • Not covered by CDIC deposit insurance

Currently Available (10+)

TD XSP ETF-Linked Growth Notes
5.5y - 0%
TD Equities-Linked Maximum Return Notes
5.5y - 0%
TD Canadian Equity Index-Linked Maximum Return Notes
5.5y - 0%
RBC Principal Protected Solactive Canada Blue Chip III AR 205 Index LEOS
3.5y - 0%
RBC Principal Protected Solactive Canada Utilities 5% AR Index LEOS
3.5y - 0%
RBC Principal Protected Solactive Canada Utilities 5% AR Index LEOS
3.5y - 0%
BMOBMO AutoCallable Principal Protected Deposit Notes, Linked to Solactive XLP Daily CAD Hedged 167 AR Index
7y 5.40% / 37.80% max -100%
BMOBMO AutoCallable Principal Protected Deposit Notes, Linked to Solactive XLP Daily CAD Hedged 167 AR Index
7y 7.15% / 50.05% max -100%
CIBCCIBC Canada Large Cap Equity Index (40 AR) Autocallable Deposit Notes
7y 6.75% / 47.25% max 0%
SCOTIABNS Canadian Banks (AR) Index Deposit Notes
3.5y - 0%
View all 64 notes →

Other Structure Types

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For educational purposes only. Not investment advice. Information may contain errors or omissions. Consult a qualified financial advisor before making investment decisions.