Product news: More cash ETFs to chase a runaway trend

The cash rush continues for Canadian ETFs.

Evolve Funds Group Inc. released two money market ETFs this week that invest in high-quality government and corporate debt securities maturing in a year or less.

Evolve’s Premium Cash Management Fund (TSX: MCAD), which also comes in a mutual fund version, targets a 4.7% yield. The management fee is 0.20% for the ETF and Series F, and 0.45% for Series A, though Evolve has waived those fees until the end of this year. The U.S. Premium Cash Management Fund (TSX: MUSD) targets a yield of 5.3%, and comes in the same versions and with the same fees.

Cash-alternative products have received massive inflows over the past year as high interest rates boosted yields and more investors have been content to sit on the sidelines in a volatile market. A TD Securities report this week said cash is the top ETF theme so far this year, bringing in $3.4 billion in new assets.

Purpose Investments Inc. released a U.S.-dollar version of its cash management fund earlier this month.

Joining the all-in-one party

CI Global Asset Management released a suite of asset allocation ETFs, joining a growing group of fund companies offering investors one-ticket investment solutions. CI’s six new funds, which charge a 0.22% management fee, invest primarily in passive ETFs offered by CI GAM and other providers. The suite includes the standard conservative (20% equities/80% fixed income), balanced (60/40) and growth (80/20) options, as well as in-between versions for balanced income (40/60), balanced growth (70/30) and 100% equity. All six ETFs trade on the TSX.

Active equity releases

FT Portfolios Canada Co. released a new active ETF that invests in a basket of underlying target outcome ETFs. The First Trust Cboe Vest Fund of Buffer ETFs (Canada) ETF (BUFR: Cboe Canada) provides exposure to U.S. large caps through a laddered portfolio of four “buffer” ETFs. Those funds use an options strategy to cap upside performance while aiming to provide a 10% downside buffer over a one-year target period.

The four underlying funds’ target outcome periods reset annually at different quarterly intervals. This laddered approach may reduce the risk of having the upside potential for the entire investment capped in cases where the S&P 500 makes rapid gains, the firm said.

The ETF’s management fee is 1% (0.15% for the ETF and 0.85% for the underlying Cboe ETFs) and the risk rating is low to medium.

Fidelity Investments Canada ULC launched ETF versions of some of its active strategies. The Fidelity Global Innovators ETF (Cboe Canada: FINN; FINN.U for the U.S.-dollar version) follows a similar investment strategy to the Fidelity Global Innovators Class and Fidelity Global Innovators Investment Trust funds, focusing on disruptive companies of all sizes across the globe — including private companies. It has a management fee of 0.85% and a medium-to-high risk rating.

The firm also released ETF series of the Fidelity Canadian Large Cap Fund (FCLC), the Fidelity Greater Canada Fund (FCGC) and the Fidelity Global Small Cap Opportunities Fund (FCGS/FCGS.U), which are all trading on Cboe Canada (formerly NEO).

Fund closures

Horizons ETFs Management (Canada) Inc. is terminating three funds, while AGF Investments Inc. is closing some of its corporate class funds to new investors.

Horizons is closing the Horizons GX Telemedicine and Digital Health Index ETF, the Horizons Global Vaccines and Infectious Diseases Index ETF and the Horizons North American Infrastructure Development Index ETF in early August. All three funds launched in the fall of 2021 and none had more than $3 million in assets.

The list of AGF corporate class funds being capped is here.

If you have investment product news, email Mark Burgess at markb@newcom.ca.