Historically, a laddered bond strategy has helped reduce the risks associated with rising interest rates, but managing a fixed-income portfolio requires expertise.
PowerShares Canada today announced the listing of two new smart beta exchange-traded funds (ETFs) on the
"As an innovator in the Canadian ETF market, PowerShares Canada recognizes the value of smart beta investment strategies," said
PowerShares 1-3 Year Laddered Floating Rate Note Index ETF (PFL) seeks to replicate, before fees and expenses, the performance of the FTSE TMX Canada 1-3 Year Laddered Floating Rate Note Index. The index is designed to give investors exposure to a laddered basket of Canadian government and corporate investment-grade floating-rate notes. PFL has a low management fee of just 0.20%.
PowerShares LadderRite U.S. 0-5 Year Corporate Bond Index ETF (USB/USB.U) seeks to replicate, before fees and expenses, the performance of the NASDAQ LadderRite 0-5 Year USD Corporate Bond Index. The index is designed to give investors exposure to a laddered basket of U.S.-dollar-denominated, investment-grade corporate bonds. USB has a low management fee of 0.25%. The ticker symbol "USB" represents Canadian-dollar-denominated units, while "USB.U" represents U.S.-dollar-denominated units.
"The low interest rates paid on government bonds makes short-term U.S. corporate debt and floating-rate notes quite attractive to investors seeking yield," Cooke said. "Both the laddering structure and the short duration of the underlying securities help reduce interest-rate sensitivity."
PFL and USB/USB.U complement PowerShares Canada's existing suite of TSX-listed fixed-income ETFs, which includes:
• PowerShares Tactical Bond ETF (PTB) • PowerShares 1-5 Year Laddered Investment Grade Corporate Bond Index ETF (PSB) • PowerShares Ultra Liquid Long Term Government Bond Index ETF (PGL) • PowerShares Senior Loan (CAD Hedged) Index ETF (BKL) •
To learn more about TSX-listed PowerShares ETFs, please visit www.powershares.ca.
U.S.-dollar-denominated units do not provide a currency hedge between the Canadian dollar and the U.S. dollar.
"TMX" is a trade mark of
NASDAQ®, OMX®, and NASDAQ OMX® are registered trademarks of The NASDAQ OMX Group, Inc. ("NASDAQ OMX") and LadderRite® is a registered trademark of
Commissions, management fees and expenses may all be associated with investments in exchange-traded funds (ETFs). ETFs are not guaranteed, their values change frequently and past performance may not be repeated. Please read the prospectus before investing. Copies are available from
There are risks involved with investing in ETFs. Please read the prospectus for a complete description of risks relevant to the ETF. Ordinary brokerage commissions apply to purchases and sales of ETF units.
Most PowerShares ETFs seek to replicate, before fees and expenses, the performance of the applicable Index, and are not actively managed. This means that the Sub-advisor will not attempt to take defensive positions in declining markets and the ETF will continue to provide exposure to each of the securities in the Index regardless of whether the financial condition of one or more issuers of securities in the Index deteriorates. In contrast, if a PowerShares ETF is actively managed, then the Sub-advisor has discretion to adjust that PowerShares ETF's holdings in accordance with the ETF's investment objectives and strategies.
ETFs are not diversified investments.
PowerShares Canada is registered business name of
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