Canadian ETFs: 23 new ETFs join the Canadian marketplace

At the start of March, the markets began to grapple with the levels of uncertainty that have been triggered by the Trump administration. Stocks took a deep dive as investors reacted to the tariff talks going into effect, extending a lengthy stretch of volatility across global markets. The bitcoin industry was also hit by the overall market volatility as it fell to US$75,000 at one point in the month. The gold trade was the major winner with sentiment being extremely bullish as it drove gold prices above US$3,000 an ounce.

According to Morningstar’s Best-Performing ETFs report, gold ETFs occupied half of its top 10 list. Blackrock’s iShares S&P/TSX Global Gold Index ETF (XGD-T) was the best performing Canadian ETFs for the first quarter of this year with a total return of 36.26%. This passively managed fund replicates the S&P/TSX Global Gold Index. The Global X Gold Producer Equity Covered Call ETF (GLCC-T) took the second spot with a 3-month return of 35.28%. While focusing on equity securities of North American gold producers, the fund also employs a dynamic covered call strategy to hedge against downside risk and generate additional income. BMO Global Asset Management edged out Harvest ETFs for third place with BMO Equal Weight Global Gold Index ETF (ZGD-T) earning a return of 34.31%.

Additions

Twenty-three new ETFs were launched in the Canadian market for the month of March.

BMO Asset Management

BMO Asset Management launched three new BMO Target Maturity Bond ETFs. Unlike traditional bonds, these ETFs are designed to provide income for a fixed period during the year of maturity and minimize reinvestment risk, which is the risk that proceeds from maturing bonds being invested in instruments that have an unknown future interest rate. The BMO Target 2027-2029 Canadian Corporate Bond ETFs (ZXCO-T, ZXCP-T, ZXCQ-T) will invest primarily in investment-grade debt instruments of Canadian issuers that have an effective maturity in each respective year. The ETFs also employ the use of derivatives to implement a hedging strategy designed to minimize reinvestment risk in the following year as a result of staggered bond maturity dates.

Harvest ETFs

Harvest ETFs expanded its Enhanced High Income Shares lineup with seven new ETFs, offering investors exposure to leading U.S. companies. The newly listed ETFs include single-stock strategies for Alphabet (GOGY-T), Advanced Micro Devices (AMDY-T), Broadcom (AVGY-T), Coinbase (CNYE-T), Costco (COSY-T), MicroStrategy (MSTE-T), and Netflix (NFLY-T).

These ETFs employ an active and flexible covered call strategy on up to 50% of the portfolio to provide high monthly cash distributions to its unitholders. The fund also applies modest leverage at around 25% for higher income and growth potential. Investors gain access to widely held U.S. stocks at a lower entry point compared to direct ownership, all in Canadian dollars.

Evolve ETFs

Evolve Funds Group Inc. added to its suite of innovative ETFs with the launch of eight new funds, introducing Canada’s first levered bitcoin and ether ETFs, alongside two enhanced yield strategies. The Evolve Levered Bitcoin ETF (LBIT-T, LBIT.U-T) and Evolve Levered Ether ETF (LETH-T, LETH.U-T), along with their USD-denominated versions, offer investors 1.25x exposure to the daily price movements of bitcoin and ether, respectively. Investors will have access to bitcoin and ether directly in portfolios through brokerage accounts as opposed to crypto trading platforms.

In addition, Evolve introduced the Evolve Enhanced Yield Mid Term Bond Fund (MIDB-T, MIDB.B-T, MIDB.U-T) which targets medium-duration fixed income exposure in North American markets with an added active covered call strategy to increase yield.

Lastly, the Evolve Canadian Energy Enhanced Yield Index Fund (OILY-T) seeks to replicate up to 1.25 times multiple of the performance of the Solactive Canada Energy Top 10 Index. In combining a focused equity strategy with a dynamic covered call approach and leverage, the fund endeavours to enhance yield while mitigating risk and reduce volatility.

StarLight ETFs

Starlight Capital launched two new funds that individually concentrates on exposure to North American and global markets. The Starlight North American Equity Fund (SCNA-NE) provides a balanced approach, investing in both Canadian and U.S. securities, with the flexibility to adjust geographic allocations based on market conditions. The fund applies fundamental analysis to identify companies with strong growth and value potential while managing downside risk.

The Starlight Global Growth Fund (SCGG-NE) delivers international diversification by investing in common shares and debt obligations outside of Canada, with a focus on large-cap growth companies. The fund aims to generate long-term capital appreciation through exposure to leading global issuers across various sectors.

J.P. Morgan

J.P. Morgan Asset Management broadened its Canadian ETF lineup with two actively managed equity funds on the Toronto Stock Exchange, offering investors targeted exposure to U.S. equity markets through distinct value and growth strategies while following fundamental, bottom-up approaches to identify quality companies. The JPMorgan US Value Active ETF (JAVA-T) focuses on large-cap companies trading at attractive valuations, with an emphasis on sectors such as financials, health care, and industrials. The JPMorgan US Growth Active ETF (JGRO-T) seeks to outperform the Russell 1000 Growth index by targeting underappreciated growth opportunities, primarily in the large-cap space, with flexibility across market caps.

Guardian Capital

Guardian Capital LP launched the Guardian i³ Global Dividend Premium Yield Fund (GIDY-T) to provide investors with regular dividends through investing in global dividend-paying securities, enhanced by a conservative covered call overlay. The Fund was managed by the i³ Investments™ Team, which utilized advanced analytics and artificial intelligence to identify companies with strong total return potential. The covered call strategy is designed to increase income generation while preserving long-term capital growth. Investors benefit from enhanced, tax-efficient monthly distributions and reduced portfolio volatility.

Amy Mak, is ETF Specialist at Inovestor.

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