TORONTO, April 12 /CNW/ - Jovian Capital Corporation ("Jovian") (TSX:JOV) and its subsidiary AlphaPro Management Inc. ("AlphaPro"), the manager of the Horizons AlphaPro family of exchange traded
funds, are pleased to announce the launch of the Horizons AlphaPro
Enhanced Income Energy ETF ("AlphaPro HEE") and the Horizons AlphaPro Enhanced Income Gold Producers ETF ("AlphaPro HEP") (collectively, the "ETFs"). Each ETF offers Canadian investors access to an innovative covered
call strategy on energy and gold company stocks respectively.
Both ETFs begin trading today on the Toronto Stock Exchange ("TSX") under the following ticker symbols:
Name of ETF
TSX Ticker Symbol
Horizons AlphaPro Enhanced Income Energy ETF
Horizons AlphaPro Enhanced Income Gold Producers ETF
The investment objective of AlphaPro HEE is to provide unitholders with:
(a) exposure to the performance of an equally-weighted portfolio of
Canadian companies that are involved in the crude oil and natural gas
industry; and (b) monthly distributions of dividend and call option
AlphaPro HEE will invest primarily in a portfolio of equity and equity
related securities of Canadian companies that are primarily involved in
the crude oil and natural gas industry and that, as at each semi-annual
rebalance date, are amongst the largest and most liquid issuers on the
TSX in their sector. To mitigate downside risk and generate income,
AlphaPro HEE will generally write covered call options on 100% of the
portfolio securities. The level of covered call option writing may
vary based on market volatility and other factors.
The investment objective of AlphaPro HEP is to provide unitholders with:
(a) exposure to the performance of an equally-weighted portfolio of
North American based gold mining and exploration companies; and (b)
monthly distributions of dividend and call option income.
AlphaPro HEP will invest primarily in a portfolio of equity and equity
related securities of North American companies that are primarily
exposed to gold mining and exploration and that, as at each semi-annual
rebalance date, are amongst the largest and most liquid issuers in
their sector. AlphaPro HEP will generally write covered call options
on 100% of the portfolio securities. The level of covered call option
writing may vary based on market volatility and other factors. Any
foreign currency gains or losses as a result of AlphaPro HEP's
investment in non-Canadian issuers will be hedged back to the Canadian
dollar to the best of its ability.
"These are the two latest additions to AlphaPro's family of enhanced
income solutions, which use covered call strategies to generate income.
By implementing a covered call strategy on these energy and gold
company stocks, investors can earn an attractive, tax-efficient monthly
income and ideally reduce the volatility of investing in these
sectors," said Ken McCord, President of AlphaPro. "These two new ETFs offer investors a cost-effective approach to access
a managed covered call strategy of energy and gold company stocks. For
energy stock investors, AlphaPro HEE can be a compelling tax-efficient
alternative to income trusts, and for gold stock investors, AlphaPro
HEP can potentially generate an attractive yield in a sector that
traditionally offers a very low dividend yield."
AlphaPro's affiliate, JovInvestment Management Inc. ("JovInvestment"), will act as investment advisor to both ETFs, with its investment
team, including Eden Rahim, Vice President and Portfolio Manager,
providing the portfolio management services. Mr. Rahim has two decades
of experience managing institutional option writing and hedging
solutions. These will be the third and fourth cover-call writing
mandates that JovInvestment manages for AlphaPro, and are in addition
to the Horizons Gold Yield Fund (TSX:HGY.UN) and the Horizons AlphaPro
Enhanced Income Equity ETF (TSX:HEX), which both utilize innovative
call writing strategies.
"Historically, a covered call writing strategy has offered a much less
volatile return profile than the underlying basket of stocks, and tends
to outperform in bear markets or moderate return cycles but lags in
bull markets," Mr. McCord said. "Energy and gold stocks, in particular, offer a unique opportunity
because of their higher historical volatility. The volatility of these
sectors enables the generation of option premium, turning what are
traditionally thought of as high capital appreciation stocks into
potentially strong income-generating stocks."
It is anticipated that each ETF will make monthly distributions of its net dividend and call option
income to its unitholders. Call option premium is anticipated to be
treated as capital gains income, while the dividend income will be
eligible for the Canadian dividend tax credit.
The ETFs have closed the initial offering of their units and will begin trading
on the TSX when the market opens this morning.
Commissions, trailing commissions, management fees and expenses all may
be associated with an investment in the ETFs. The ETFs are not
guaranteed, their values change frequently and past performance may not
be repeated. Please read the prospectus before investing.
About AlphaPro Management Inc. (www.HAPETFs.com)
AlphaPro is an innovative financial services company specializing in
actively managed exchange traded funds with assets under management of
approximately $609 million as of March 31, 2011. AlphaPro is a
subsidiary of BetaPro Management Inc. ("BetaPro"). BetaPro manages the Horizons BetaPro family of exchange traded
funds, a broadly diversified range of investment tools with solutions
for investors of all experience levels to meet their investment
objectives in a variety of market conditions. The Horizons BetaPro ETFs
include several types of structures: single, inverse, leveraged,
inverse leveraged and spread ETFs. BetaPro manages approximately $2.3
billion in assets as of March 31, 2011. BetaPro is a subsidiary of
Jovian Capital Corporation (TSX:JOV).
About Jovian Capital Corporation
Jovian acquires, creates and grows financial services companies
specializing in three primary market segments: wealth management,
traditional asset managers, and exchange traded fund asset managers.
The Jovian group of companies (AlphaPro Management Inc., BetaPro
Management Inc., Hahn Investment Stewards & Company Inc., Horizons
Exchange Traded Funds Inc., JovFunds Management Inc., JovInvestment
Management Inc., Leon Frazer & Associates Inc., MGI Financial Inc., MGI
Securities Inc., MGI Securities (USA) Inc. and T.E. Wealth) manages
approximately $13.0 billion of client assets ($7.5 billion in assets
under management and $5.5 billion in assets under administration).
Additional information is available at www.joviancapital.com and www.sedar.com.
SOURCE Jovian Capital Corporation
For further information:
For more information:
Don Sangster, Investor Relations, Jovian Capital Corporation, (416) 933-5744; or
Philip Armstrong, Chief Executive Officer, Jovian Capital Corporation, (416) 933-5752.