Announced products include Canada’s first mortgage-backed security ETF and hedged series of Treasury-bond ETF
BMO Asset Management has introduced new ETFs on the TSX and the NEO Exchange.
On the TSX, the firm has launched five new strategies, including Canada’s first mortgage-backed security (MBS) ETF.
The BMO Canadian MBS Index ETF (TSX: ZMBS) invests in pools of mortgage-backed securities that are insured under the Canada National Housing Act and fully guaranteed by the Canada Mortgage and Housing Corporation (CMHC). Each pool has a term to maturity greater than one year, with a minimum amount outstanding of $100 million.
Additionally, the BMO BBB Corporate Bond Index ETF (TSX: ZBBB) invests in one- to 10-year BBB-rated corporate bonds, and the BMO High Quality Corporate Bond Index ETF (ZQB) invests in one- to 10-year corporate bonds with a minimum credit rating of A.
ZMBS, ZBBB, and ZQB will track fixed-income indexes provided by FTSE Russell.
BMO also introduced the BMO S&P US Mid Cap Index ETF (TSX: ZMID, ZMID.U, ZMID.F) and the BMO S&P US Small Cap Index ETF (TSX: ZSML, ZSML.U, ZSML.F). By investing in the mid- and small-cap segment of the U.S. equity space, respectively, the two growth-oriented ETFs provide exposure to maturing companies with revenues concentrated from the U.S. economy.
On the NEO Exchange, BMO launched a hedged series of the BMO Long-Term US Treasury Bond Index ETF. The BMO Long-Term US Treasury Bond Index ETF (NEO: ZTL.F) is designed to provide a flight-to-safety trade through exposure to U.S. Treasuries with greater than 20 years to maturity, while mitigating currency impact.
“Our suite of U.S. Treasury ETFs are segmented by term, offering defensive portfolio building blocks with the flexibility to choose your exposure,” said Mark Raes, Head of Product, BMO Global Asset Management. “With the additional launch, we now offer hedged, unhedged and USD options providing investors with more choice to implement their market and currency views.