ETF changes at BMO

BMO Financial Group has licensed indexes for three of its ETFs.

China Equity Hedged to CAD ETF (ZCH) and the BMO India Equity Hedged to CAD ETF (ZID) will be licensing indices from The Bank of New York Mellon. ZCH will be benchmarked to the BNY Mellon China Select ADR Index CAD. ZID will be benchmarked to the BNY Mellon India Select DR Index CAD. ZHY will be licensing an index from Barclays Capital Inc. It will be benchmarked to the U.S. High Yield Very Liquid Index CAD Hedged.

BMO will also be holding a meeting on May 12th with the BMO Canadian Government Bond Index ETF (BMO ETF) unitholders. The purpose of the meeting is to consider revising the investment objectives of the BMO ETF by replacing the current underlying index – the Citigroup Canadian Government Bond Index – with the DEX Mid Term Federal Bond Index.

The DEX Mid Term Federal Bond Index consists of semi-annual pay fixed rate bonds denominated in Canadian dollars with an effective term to maturity between 5 and 10 years, a credit rating of AAA and minimum size requirement of $50 million per issue. The federal sector consists of bonds issued by the Government of Canada (including both non-agency and agency/crown corporations) and supra-national entities.

By changing to the DEX Mid Term Federal Bond Index, BMO believes investors will have the ability to focus their investment on the mid-term section of the federal bond market. The index change would allow the BMO ETF to be more efficiently managed resulting in the maximum annual management fee being reduced to 0.20%. The index change is subject to all required regulatory approvals.