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You're not alone if you were scared senseless by the fact that your supposedly safe guaranteed investment certificates were issued by troubled Home Capital.

My interactions with readers in recent weeks suggest some investors were so jolted they looked into selling GICs with a penalty charge, even though they're backed by Canada Deposit Insurance Corp. Here are a couple of examples:

1 - A 43-year-old Ottawa resident named Peter invested $25,000 in a three-year, 1.4 per cent Home Trust GIC through his online broker, RBC Direct Investing, in January 2015. He picked Home Trust largely based on the interest rate – high but not the highest. He chose GICs as a vehicle because he works contract jobs in the film industry and has little tolerance for losing money.

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Peter found out about Home Capital's problems while reading the newspaper last month and was shocked. "Your heart leaps into your stomach when you first read that and you go, oh crap, you've lost $25,000." He quickly realized Home Trust deposits are protected by CDIC, but still tried to sell the GIC online. He clicked the sell button on his brokerage website, but gave up on the idea after reading a notice saying he had to call in to proceed with the transaction.

His next step was to e-mail CDIC to ask what their opinion of Home Trust was and what their advice would be about his GIC. He got a form letter back from the federal agency saying it can't provide advice about buying or selling an investment.

2 - A 61-year-old Toronto woman named Cheryl invested $25,000 in Oaken Financial GICs for each of her two adult children to help pay for their university education. "I was Googling 'GICs, best rates' and Oaken popped up," she recalled.

Her investing rationale: Earn a better return than the one provided by the money market funds the money was sitting in previously, without exposure to the ups and downs of the stock market. "When I first heard the news [about Home Capital], I thought, well ,this is ironic. This is money I wanted to be 100 per cent safe, with no risk."

After finding out about CDIC's coverage, she decided not to follow through on her initial impulse to sell the GICs at a penalty to avoid further losses. "I've just sort of left it, hoping it works out one way or another."

Before buying GICs or putting money in a high interest savings account, check my guide to which alternative financial institutions are paying the best rates. Included here are details on how Oaken Financial and Home Trust are connected to Home Capital.

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