Market month: Fund news and updates
New funds from BMO, CIB C, Fidelity and RBC; Invesco terminates 36 funds
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* BMO debuts five new ETFs. BMO Asset Management Inc. on Jan. 26 announced the launch of five new ETFs:
BMO Covered Call Energy ETF (TSX: ZWEN) seeks to provide exposure to the performance of a portfolio of energy and energy related companies, which may include clean energy (i.e., renewable energy) companies, to generate income and to provide long-term capital appreciation while mitigating downside risk through the use of covered call options.
BMO Covered Call Health Care ETF (TSX: ZWHC) holds a portfolio of health care and health care related companies.
BMO Global Agriculture ETF (TSX: ZEAT) holds portfolio of global agriculture and agriculture related companies.
BMO US Aggregate Bond Index ETF (TSX: ZUAG) tracks the Bloomberg US Aggregate Bond Index.
BMO US TIPS Index ETF (TSX: TIPS) tracks the Bloomberg US Treasury Inflation-Linked Bond Index (Series-L).
* Fidelity adds new fund to SmartHedge lineup. Fidelity Investments Canada on Jan. 25 launched its Fidelity SmartHedge U.S. Equity Fund, with the objective of achieving long-term capital growth by investing primarily in stocks of some of America's largest companies. The fund uses an options-based derivatives strategy to hedge market exposure to help mitigate downside risk while providing upside participation. This new fund will be managed by Zach Dewhirst, Mitch Livstone, and Eric Granat.
* Invesco cleans house. Invesco Canada Ltd. announced on Jan. 23 plans to terminate 14 ETFs and 22 mutual funds in order “to simplify the firm’s product offerings to enable it to sharpen the focus on areas of highest client demand.”
It plans to terminate the following TSX-listed ETFs, effective close of business on or about April 21, 2023. The ETFs will continue to be listed on the Toronto Stock Exchange until the close of business on or about April 17, 2023, when they are expected to cease trading and be delisted.
Invesco also plans to terminate the following NEO-listed ETFs, effective close of business on or about April 21, 2023. The ETFs will continue to be listed on the NEO Exchange Inc. until the close of business on or about April 17, 2023, when they are expected to cease trading and be delisted.
Invesco announced the planned termination of the following mutual funds effective April 6, 2023. Effective immediately, all series of shares and units of these funds are closed to all investments.
In addition, Invesco will be terminating the Invesco Allocation Fund effective May 5, 2023. Effective immediately, all series of units of this fund are closed to new investments other than investments from investors who as of Jan. 23 are existing investors of the fund or existing participants of the Invesco Rebalancing Service. The fund will be closed to all investments effective on or about close of business May 3, 2023.
* CIBC launches two new index ETFs. CIBC Asset Management Inc. on Jan. 23 debuted two new index ETFs designed to cover the core exposures in a typical asset allocation strategy.
CIBC Canadian Short-Term Bond Index ETF (TSX: CSBI) tracks the Morningstar Canada 1-5 Y Core Bond Index.
CIBC U.S. Equity Index ETF (CAD-hedged) (TSX: CUEH) tracks the Morningstar US Target Market Exposure Hedged CAD Index.
Towards the end of February CIBC Asset Management also intends to launch the CIBC International Equity Index ETF (CAD-hedged), tracking the Morningstar Developed Markets ex-North America Target Market Exposure Hedged CAD Index.
* Evolve terminates ETF. Evolve Funds Group Inc. on Jan. 19 announced that it will terminate the Evolve Enhanced FANGMA Index ETF (TSX: TECE) on or about March 29 with delisting from the TSX on or about March 27. Before termination the assets of the fund will be converted to cash and distributed pro-rata among the unitholders of record on the termination date.
* RBC iShares debuts two new covered call ETFs. RBC iShares on Jan. 17 debuted its new RBC Canadian Dividend Covered Call ETF (TSX: RCDC) and RBC U.S. Dividend Covered Call ETF (TSX: RUDC).
The ETFs are designed for investors seeking a current source of income while mitigating some downside risk, with an active management strategy, combining the selection of dividend-paying stocks and a covered call-writing strategy. The funds aim for exposure to a diversified portfolio of Canadian or U.S. equity securities.
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