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* Evolve announces two new enhanced yield ETFs. Evolve Funds Group Inc. on Jan. 4 announced that it had filed a final prospectus for two new enhanced yield funds tied to traditional indexes.
The funds are expected to begin trading on Tuesday, January 10, 2023, subject to TSX approval. The ETFs are designed to provide investors with the performance of S&P/TSX 60 and S&P 500 indexes, respectively, with the addition of enhanced yield through active covered call strategies on the underlying securities.
Evolve S&P/TSX 60 Enhanced Yield Fund (TSX: ETSX) tracks the performance of the S&P/TSX 60 Index, while mitigating downside risk. The fund invests primarily in the equity constituents of the S&P/TSX 60 Index, while writing covered call options on up to 33% of the portfolio, at the discretion of the Manager. The level of covered call option writing may vary based on market volatility and other factors.
Evolve S&P 500 Enhanced Yield Fund (TSX: ESPX) aims for long-term capital growth by tracking the S&P 500 Index. It invests primarily in the equity constituents of the S&P 500 Index, while writing covered call options on up to 33% of the portfolio, at the discretion of the Manager. The level of covered call option writing may vary based on market volatility and other factors.
Evolve believes that the ETFs are suited for a covered call strategy and that option writing may have the potential to add value, as an effective way to help lower the level of volatility for an investor and potentially improve returns.
* IFIC releases November investment fund sales. The Investment Funds Institute of Canada (IFIC) on Dec. 20 announced investment fund net sales and net assets for November 2022.
Mutual fund assets totalled $1.870 trillion at the end of November 2022. Assets increased by $74.1 billion, or 4.1%, compared with October 2022. Mutual funds recorded net redemptions of $8.7 billion in November 2022.
ETF assets totalled $317.8 billion at the end of November 2022. Assets increased by $17.2 billion, or 5.7%, compared with October 2022. ETFs recorded net sales of $4.2 billion in November 2022.
More information at https://www.ific.ca/en/.
* Purpose launches suite of single-stock Yield Shares ETFs. Purpose Investments Inc. on Dec. 20 debuted its Yield Shares by Purpose, the world’s first yield-focused single-stock ETFs, which will trade on the NEO Exchange Inc.
Yield Shares aim to enhance monthly distribution yield through an investment in funds holding some of the world’s most widely held stocks, such as Amazon.com, Berkshire Hathaway, and Tesla, while maintaining exposure to the underlying individual stock’s performance.
“It’s a turbulent economic environment right now, and with Yield Shares by Purpose, we’re excited to offer Canadians the opportunity to get exposure to individual stocks like Tesla and Apple and receive enhanced monthly distributions while being invested in them,” says Vlad Tasevski, Chief Operating Officer and Head of Product.
The following five Yield Shares are now available:
Alphabet (GOOGL) Yield Shares Purpose ETF (NEO YGOG) tracks Alphabet Inc.
Apple (AAPL) Yield Shares Purpose ETF (NEO: APLY) tracks Apple Inc.
Amazon (AMZN) Yield Shares Purpose ETF (NEO: YAMZ) tracks Amazon.com Inc.
Berkshire Hathaway (BRK) Yield Shares Purpose ETF (NEO: BRKY) tracks Berkshire Hathaway Inc.
Tesla (TSLA) Yield Shares Purpose ETF (NEO: YTSL) tracks Tesla Inc.
These unique Canadian-dollar-denominated Yield Shares by Purpose seek to generate distribution yield above any dividends payable on the underlying stock by implementing covered call option strategies (targeted at 50%) and moderate leverage (targeted at a maximum of 25% of net asset value) to earn enhanced monthly yield. Purpose said in a release that the Yield Shares will provide investors with a different risk-return profile compared with investing in the underlying stocks directly and can be used as additional tools to customize their portfolios.
* Franklin Templeton changes names and objectives of two ETFs. Franklin Templeton Canada on Dec. 9 announced name changes and new investment objectives for two equity ETFs.
Franklin Emerging Markets Multifactor Index ETF (TSX: FLEM) becomes the Franklin Emerging Markets Equity Index ETF (TSX: FLEM), and tracks the performance of Solactive GBS Emerging Markets Large & Mid Cap CAD Index-NR. It invests primarily in equity securities in emerging markets.
Franklin FTSE Europe ex U.K. Index ETF (NEO: FLUR) becomes the Franklin International Equity Index ETF (NEO: FLUR) and tracks the performance of Solactive GBS Developed Markets ex North America Large & Mid Cap CAD Index-NR. It invests primarily in equity securities of large- and mid-capitalization issuers in developed markets, excluding North America.
* Franklin Templeton merges two bond ETFs. Franklin Templeton Canada on Dec. 9 announced the merger of two bond ETFs effective Dec. 16. Franklin U.S. Investment Grade Corporate Bond Active ETF (CAD-Hedged) (TSX: FLUI) merged into Franklin Western Asset Core Plus Bond Active ETF (TSX: FWCP).
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