Listing of Horizons HBB ETF on Toronto Stock Exchange
FRANKFURT, May 8, 2014 /CNW/ - Solactive AG enters the bond space in Canada with the launch of two new indices: the Solactive Canadian Select Universe Bond Index and the Solactive Canadian Select Corporate Bond Index. The former is being used as the underlying index for the Horizons Cdn Select Universe Bond ETF (HBB) sponsored by Horizons ETFs Management (Canada) Inc. and listed today on the Toronto Stock Exchange.
In 8 years, Solactive has become one of the key players in the indexing space, focusing on tailor-made indices, with 20 billion USD invested in products linked to indices calculated and 125 ETFs tied to its indices, as of 31st December 2013. Headquartered in Frankfurt, Solactive grew significantly on both sides of the Atlantic over the past years, now ranking 3rd in the US, in terms of ETFs linked to indices calculated.
Fixed income exchange-traded funds have seen a tremendous growth in the country, as they now account for 29.3% of the overall CAD 66 billion currently invested in ETFs in Canada,* and are commonly considered by investors as an efficient, low-cost alternative to both mutual funds and buying bonds individually.
The goal of the Solactive Canadian Select Universe Bond Index is to measure the performance of the Canadian government and corporate bonds market, while for the Solactive Canadian Select Corporate Bond Index it is to measure Canadian corporate bonds only. The index universe for these two indices is composed of all bonds denominated in CAD, rated Investment Grade, paying a fixed rate, with an amount outstanding of at least 100m CAD for corporate bonds and 50m for government bonds and an effective time to maturity of no less than 12 months.
Both indices are composed of a relatively small number of components compared to other national benchmarks providing similar performance. As of the 6th of May, the Solactive Canadian Select Universe Bond Index has 180 components for a performance of 6.25% and the Solactive Canadian Select Corporate Bond has a performance of 11.85% (since 3rd January 2012.)
Astrid Ludwig, Head of the Bond & Complex Team, Solactive, said: "These indices have been designed to offer an alternative way of replicating the Canadian investment grade bond market, without considering every single bond being issued. We hope that the launch of a new product in this market will benefit the end-investors."
Howard Atkinson, President of Horizons ETFs, said: "We're pleased to be partnering with Solactive on this important ETF launch for our firm. We think Solactive have done a great job in building a fixed income index that offers all the performance characteristics of the broad Canadian Bond Universe, but uses a more focused methodology that allows for easier and cost-efficient replication."
The Solactive Canadian Select Universe Bond Index and the Solactive Canadian Corporate Bond Index were based on 1,000 at close of trading on 24th February 2014. Back-tested historical data is available from 3rd January 2012. Both indices are rebalanced on a monthly basis, calculated in price return and total return.
* According to the CETFA (Canadian ETF Association) Monthly Report published on March 31, 2014
This launch follows the recent launches earlier this year of the Solactive Green Bond Index in partnership with the Climate Bonds Initiative and the Solactive MLP Bond Index, two innovative indices in that space.
Solactive AG is one of the key players in the indexing space. Focusing on tailor-made indices, the German multi asset class provider is developing, calculating and distributing them worldwide. As of 31st December 2013, Solactive AG calculates 1,000 indices for over 100 clients in Europe, America and Asia. Approximately 20 billion USD are invested in products linked to indices calculated by the Company globally, primarily via 125 ETFs.
HORIZONS ETFs MANAGEMENT (CANADA) INC.
Horizons ETFs Management (Canada) Inc. and its affiliate AlphaPro Management Inc. are innovative financial services companies offering the Horizons ETFs family of exchange-traded funds. The Horizons ETFs family includes 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. With approximately $4.1 billion in assets under management and 70 ETFs listed on the Toronto Stock Exchange, the Horizons ETFs family makes up one of the largest families of ETFs in Canada. Horizons ETFs Management (Canada) Inc. and AlphaPro Management Inc. are members of the Mirae Asset Financial Group.
The information in this document does not constitute tax, legal or investment advice and is not intended as a recommendation for buying or selling securities. Solactive AG and all other companies mentioned in this document will not be responsible for the consequences of reliance upon any opinion or statement contained herein or for any omission.
Commissions, trailing commissions, management fees and expenses all may be associated with an investment in exchange traded funds. Exchange traded funds are not guaranteed, their values change frequently and past performance may not be repeated. The prospectus contains important detailed information. Please read the prospectus before investing.
SOURCE: Solactive AG