TDAM launches six new fixed income ETFs

TD Asset Management expands with new TD TMB ETFs, offering diversified fixed income options

TDAM launches six new fixed income ETFs

TD Asset Management Inc. (TDAM) has expanded its fixed income product offerings with the introduction of six new actively managed Exchange-Traded Funds (ETFs), known as the TD Target Maturity Bond ETFs (TD TMB ETFs).

The series of TD TMB ETFs includes:

  • TD Target 2025, 2026, and 2027 Investment Grade Bond ETFs (TBCE, TBCF, TBCG) for Canadian bonds, and
  • TD Target 2025, 2026, and 2027 US Investment Grade Bond ETFs (TBUE.U, TBUF.U, TBUG.U) for US bonds.

These additions mark a significant enhancement to TDAM's fixed income suite, leveraging the expertise of its Fixed Income Investment Team.

The TD TMB ETFs, which is trading on the Toronto Stock Exchange (TSX), are designed to provide investors with various benefits, including diversification and professional management.

The newly launched TD TMB ETFs offer several key features to investors:

  • Choice of Currency Exposure: Investors have the option to invest in investment-grade corporate bonds in either Canadian or US dollars by selecting the appropriate ETF and maturity year.
  • Bond-like Maturity: These ETFs provide an opportunity to match investment cash flow needs with a specific maturity date, aiming to lessen sensitivity to interest rate changes as the ETF nears its maturity.
  • Professional Management: TDAM's Fixed Income Investment Team manages the TD TMB ETFs with a goal of minimizing credit risk and optimizing income potential through investment in investment-grade securities.
  • Diversification: The ETFs aim to offer diversification by investing in a variety of bonds from different issuers and sectors, contributing to a potentially more stable fixed income portfolio.
  • Enhanced Liquidity: With the flexibility of ETFs that trade during regular market hours, investors can adjust their portfolio allocation as their needs evolve.

Michael Augustine, managing director and head of Fixed Income and Asset Liability Management at TDAM, highlighted, “This launch showcases the value of our proprietary independent credit research capabilities and offers a compelling avenue for investors looking for potential attractive yields.”

Each TD TMB ETF is designed to generate regular income and preserve capital, focusing on investment-grade corporate bonds.

The Canadian Bond ETFs target Canadian corporate bonds denominated in Canadian dollars, while the US Bond ETFs focus on US corporate bonds denominated in US dollars.

With specified lifespans, these target maturity funds anticipate the maturation of the bonds they hold in alignment with the ETF's planned termination year.