- New energy and health care covered call ETFs address growing investor demand for higher yielding sector-based solutions while additions to fixed income shelf and global agriculture help investors manage inflation concerns
TORONTO, Jan. 26, 2023 /CNW/ – BMO Asset Management Inc. (BMOAM Inc.), the manager of the BMO ETFs, today announced the launch of five new BMO ETFs and a new class of unit of BMO Growth ETF (TSX: ZGRO.T).
The new BMO ETFs and ZGRO.T have closed their initial offering of units and will begin trading today on the Toronto Stock Exchange.
“We’re excited to introduce new ETF strategies to help investors make progress and build better portfolios,” said Mark Raes, Head of Product, BMO Global Asset Management. “Our new energy and health care covered call ETFs address growing investor demand for higher yielding sector-based solutions while additions to our fixed income shelf and a new global agriculture ETF help investors navigate inflation and rising interest rates. Continuing our offering innovation with ZGRO.T delivers convenient cashflow to investors, including those in retirement years.”
- 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) seeks to provide exposure to the performance of a portfolio of health care and health care related companies to generate income and to provide long-term capital appreciation, while mitigating downside risk through the use of covered call options.
- BMO Global Agriculture ETF (TSX: ZEAT) seeks to provide exposure to the performance of a portfolio of global agriculture and agriculture related companies to provide long-term capital appreciation.
- BMO US Aggregate Bond Index ETF (TSX: ZUAG, ZUAG.F ZUAG.U) seeks to replicate, to the extent possible, the performance of a U.S. aggregate bond index, net of expenses. Currently, this BMO ETF replicates the Bloomberg US Aggregate Bond Index. In respect of the Hedged Units, BMO US Aggregate Bond Index ETF will also invest in or use derivative instruments to seek to hedge U.S. currency exposure.
- BMO US TIPS Index ETF (TSX: TIPS, TIPS.F, TIPS.U) seeks to replicate, to the extent possible, the performance of a U.S. government inflation-linked bond index, net of expenses. Currently, this BMO ETF replicates the Bloomberg US Treasury Inflation-Linked Bond Index (Series-L). In respect of the Hedged Units, the BMO US TIPS Index ETF will also invest in or use derivative instruments to seek to hedge U.S. currency exposure.
- BMO Growth ETF (TSX: ZGRO.T) is launching a new class of unit, Fixed Percentage Distribution Units (generally referred to as T6 units), which has an annual distribution rate of 6 per cent, paid monthly. Cash distributions may be comprised of net income, net realized capital gains and/or a return of capital.
|New BMO ETF||Class of Units||Ticker Symbol (TSX)|
|BMO Covered Call Energy ETF||CAD Units||ZWEN|
|BMO Covered Call Health Care ETF||CAD Units||ZWHC|
|BMO Global Agriculture ETF||CAD Units||ZEAT|
|BMO US Aggregate Bond Index ETF||CAD Units||ZUAG|
|BMO US TIPS Index ETF||CAD Units||TIPS|
|Existing BMO ETF||New Class of Unit||Ticker Symbol (TSX)|
|BMO Growth ETF||Fixed Percentage Distribution Units (generally referred to as T6 units)||ZGRO.T|
Further information can be found at BMO ETF Centre.
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Commissions, management fees and expenses all may be associated with investments in exchange traded funds. Please read the ETF Facts or prospectus of the BMO ETFs before investing. Exchange traded funds are not guaranteed, their values change frequently and past performance may not be repeated.
For a summary of the risks of an investment in the BMO ETFs, please see the specific risks set out in the BMO ETF’s prospectus. BMO ETFs trade like stocks, fluctuate in market value and may trade at a discount to their net asset value, which may increase the risk of loss. Distributions are not guaranteed and are subject to change and/or elimination.
BMO ETFs are managed by BMO Asset Management Inc., which is an investment fund manager and a portfolio manager, and a separate legal entity from Bank of Montreal.
Distributions are not guaranteed and may fluctuate. Distribution rates may change without notice (up or down) depending on market conditions. The payment of distributions should not be confused with an investment fund’s performance, rate of return or yield. If distributions paid by an investment fund are greater than the performance of the fund, your original investment will shrink. Distributions paid as a result of capital gains realized by an investment fund, and income and dividends earned by an investment fund, are taxable in your hands in the year they are paid. Your adjusted cost base will be reduced by the amount of any returns of capital. If your adjusted cost base goes below zero, you will have to pay capital gains tax on the amount below zero. Please refer to the distribution policy for BMO ETF set out in the prospectus.
Cash distributions, if any, on units of a BMO ETF (other than accumulating units or units subject to a distribution reinvestment plan) are expected to be paid primarily out of dividends or distributions, and other income or gains, received by the BMO ETF less the expenses of the BMO ETF, but may also consist of non-taxable amounts including returns of capital, which may be paid in the manager’s sole discretion. To the extent that the expenses of a BMO ETF exceed the income generated by such BMO ETF in any given month, quarter or year, as the case may be, it is not expected that a monthly, quarterly, or annual distribution will be paid. Certain BMO ETFs have adopted a distribution reinvestment plan, which provides that a unitholder may elect to automatically reinvest all cash distributions paid on units held by that unitholder in additional units of the applicable BMO ETF in accordance with the terms of the distribution reinvestment plan. For further information, see Distribution Policy in the BMO ETFs’ prospectus.
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About BMO Exchange Traded Funds (ETFs)
BMO Exchange Traded Funds has been an ETF provider in Canada for more than 12 years, with over 100 strategies, over 25 per cent market share in Canada1, and $87.7 billion in assets under management. BMO ETFs are designed to stay ahead of market trends and provide compelling solutions to help advisors and investors. This includes a comprehensive suite of ETFs developed in Canada for Canadians, such as cost effective core equity ETFs following market leading indexes, and a broad range of fixed income ETFs; solution-based ETFs responding to client demand; and innovation with smart beta ETFs, as well as combining active and passive investing with ETF series of active mutual funds.
1 Morningstar, December 2022
About BMO Financial Group
Serving customers for 200 years and counting, BMO is a highly diversified financial services provider – the 8th largest bank, by assets, in North America. With total assets of $1.14 trillion as of October 31, 2022, and a team of diverse and highly engaged employees, BMO provides a broad range of personal and commercial banking, wealth management and investment banking products and services to 12 million customers and conducts business through three operating groups: Personal and Commercial Banking, BMO Wealth Management and BMO Capital Markets.
SOURCE BMO Financial Group
For further information: Media Contact: Jeff Roman, Toronto, Jeff.Roman@bmo.com, (416) 867-3996