BMO launches new US equity buffer ETF

BMO introduces a US Equity ETF aimed at hedging against market dips, trading now on Cboe Canada

BMO launches new US equity buffer ETF

BMO Asset Management Inc. (BMOAM Inc.), overseeing BMO ETFs, has launched the BMO US Equity Buffer Hedged to CAD ETF – April, now trading on Cboe Canada Inc. under the ticker Cboe CA: ZAPR following its initial unit offering.

This new ETF aims to mirror, as closely as possible, the returns of an index that reflects the large-cap segment of the US equity market, subject to a cap.

It offers a unique feature: a buffer against the first 15 percent drops in the market price of the reference index during the Target Outcome Period, which spans from the first business day of April each year to the last business day of March the following year.

This ETF is part of BMO’s suite of Structured Outcome ETFs, including BMO Canadian Banks Accelerator ETF, BMO US Equity Accelerator Hedged to CAD ETF, and other BMO US Equity Buffer Hedged to CAD ETFs for January and October.

These Structured Outcome ETFs are designed to provide returns over a specified Target Outcome Period.

However, investors should be aware that purchasing units after the Target Outcome Period begins or selling them before it ends could lead to results significantly different from the ETF’s intended target outcomes.

For investors to achieve the ETF's designated target outcomes, they must retain their units throughout the entirety of the Target Outcome Period.