TORONTO – May 22, 2024 – Global X Investments Canada Inc. (“Global X”) is pleased to announce the launch of seven covered call, options overlay and lightly-leveraged ETFs (the “ETFs”), further expanding its Equity Essentials suite and strengthening Canada’s largest suite of income and growth-focused funds. Units of the ETFs begin trading today on the Toronto Stock Exchange (“TSX”) and on Cboe Canada (“Cboe”).
The Global X Equity Essentials suite is comprised of funds that offer Canadian, U.S. and global exposure to the major indices managed by the world’s leading index providers, including MSCI, Nasdaq and S&P. Each Equity Essentials ETF uses up to three strategy overlays to help investors optimize their risk exposure and performance potential which include low-cost benchmark tracking, 1.25 times leverage (“1.25x”) to potentially amplify returns, and options-writing to potentially enhance income.
The launches follow the completion of the rebrand to Global X from Horizons ETFs, which was effective on May 1, 2024 and the launch of seven Equity Essentials and Thematics funds on May 15, 2024.
“We’re expanding our suite of Equity Essentials ETFs to empower Canadians to invest the way they want, whether they’re looking for greater income potential, amplified growth potential, or both,” said Rohit Mehta, President and CEO of Global X. “Combined with our existing Equity Essentials funds, Global X has Canada’s largest and most diverse shelf for accessing these essential benchmarks, including the S&P/TSX 60, the NASDAQ-100, as well as MSCI’s Developed and Emerging Markets indices.”
The new ETFs are further described in the table below:
| ETF Name and Ticker | Investment Objective | Exchange | Management Fee* |
|---|---|---|---|
| Covered Call & Options-Based | |||
| Global X MSCI EAFE Covered Call ETF (“EACC”) | EACC seeks to provide, to the extent possible and net of expenses: (a) exposure to the performance of an index of large and mid-cap securities across developed markets including countries in Europe, Australasia and the Far East, excluding the U.S. and Canada (currently, the MSCI EAFE Index); and (b) monthly distributions of dividend and call option income. To mitigate downside risk and generate income, EACC will employ a dynamic covered call option writing program. | Cboe Canada | 0.49% |
| Global X MSCI Emerging Markets Covered Call ETF (“EMCC”) | EMCC seeks to provide, to the extent possible and net of expenses: (a) exposure to the performance of an index of large and mid-cap securities across emerging markets (currently, the MSCI Emerging Markets Index); and (b) monthly distributions of dividend and call option income. To mitigate downside risk and generate income, EMCC will employ a dynamic covered call option writing program. | Cboe Canada | 0.65% |
| Global X Short-Term Government Bond Premium Yield ETF (“PAYS”) | PAYS seeks to provide: (a) exposure to the performance of government debt securities, primarily issued by the Government of Canada, generally targeting a duration less than 3 years; and (b) high monthly distributions of interest income and option premiums. To generate premiums and reduce volatility, PAYS will employ a dynamic option program. PAYS seeks to hedge any foreign currency exposure back to the Canadian dollar. | TSX | 0.40% |
| Enhanced Index | |||
| Global X Enhanced S&P 500 Index ETF (“USSL”) | USSL seeks to replicate, to the extent reasonably possible and net of expenses, 1.25 times (125%) the performance of an index of equity securities representing the large-cap market segment of the U.S. equity market (currently, the S&P 500® Index). USSL will use leverage in order to seek to achieve its investment objective. Leverage will be created through the use of cash borrowings or as otherwise permitted under applicable securities legislation. | TSX | 0.35% |
| Global X Enhanced MSCI EAFE Index ETF (“EAFL”) | EAFL seeks to replicate, to the extent reasonably possible and net of expenses, 1.25 times (125%) the performance of an index of large and mid-cap securities across developed markets including countries in Europe, Australasia and the Far East, excluding the U.S. and Canada (currently, the MSCI EAFE Index). EAFL will use leverage in order to seek to achieve its investment objective. Leverage will be created through the use of cash borrowings or as otherwise permitted under applicable securities legislation. | Cboe Canada | 0.45% |
| Global X Enhanced MSCI Emerging Markets Index ETF (“EMML”) | EMML seeks to replicate, to the extent reasonably possible and net of expenses, 1.25 times (125%) the performance of an index of large and mid-cap securities across emerging markets (currently, the MSCI Emerging Markets Index). EMML will use leverage in order to seek to achieve its investment objective. Leverage will be created through the use of cash borrowings or as otherwise permitted under applicable securities legislation. | Cboe Canada | 0.49% |
| Global X Enhanced Nasdaq-100 Index ETF (“QQQL”) | QQQL seeks to replicate, to the extent reasonably possible and net of expenses, 1.25 times (125%) the performance of an index of equity securities representing the largest domestic and international nonfinancial companies listed on The Nasdaq Stock Market (currently, the Nasdaq-100® Index). QQQL will use leverage in order to seek to achieve its investment objective. Leverage will be created through the use of cash borrowings or as otherwise permitted under applicable securities legislation. | TSX | 0.49% |
*Plus applicable sales tax
Four of the seven ETFs launched today – USSL, EAFL, EMML and QQQL (the “Enhanced ETFs”) – use leverage, a strategy that can potentially magnify both gains and losses. These Enhanced ETFs aim to generate approximately 1.25x the return of their underlying index.
To do this, each of the Enhanced ETFs creates leverage using cash borrowing and invests, on a leveraged basis, in a related ETF managed by Global X. To ensure risk is limited to the capital invested, each of the Enhanced ETFs is regularly monitored and seeks to maintain a leverage ratio of approximately 125%, or 1.25x, of its net asset value (“NAV”).
“A little leverage can go a long way, especially when applied to traditional benchmark investments that have historically been an essential building block for growth in long-term oriented portfolios,” said Mr. Mehta.
Three of the ETFs – EACC, EMCC and PAYS (the “Options-Based ETFs”) – employ options-writing as part of their active management strategy, specifically covered call overlays, an investment strategy designed to generate the potential for additional income in addition to their underlying index exposure. The Options-Based ETFs seek to generate higher yields relative to their underlying indices and may result in higher levels of monthly income for investors.
While EACC and EMCC are part of the Equity Essentials suite and provide international exposure through the MSCI EAFE Index and the MSCI Emerging Markets Index, respectively. While, PAYS is a fixed income ETF which employs both a covered call and cash-secured put overlay to primarily generate the potential for additional income on short-term Canadian government bonds.
“More and more, Canadians are looking for their investments to offer more than just growth over the long-term – they’re looking for the benefits of monthly investment income as well,” said Mr. Mehta. “Today, Global X has one of Canada’s largest suites of options-based ETFs that offer the benefits of index, sector and geographic equity and fixed income exposures, with monthly distributions on top.”
In addition to the ETFs launched today, Global X will be launching more funds on May 29, including strategies that offer access to MSCI’s international indices with exposure to light leverage and a covered call overlay.
The ETFs closed their initial offering of units to their designated broker at the close of business on May 21, 2024, and will begin trading today on the TSX.
About Global X Investments Canada Inc. (www.GlobalX.ca)
Global X Investments Canada Inc. is an innovative financial services company and offers one of the largest suites of exchange traded funds in Canada. The Global X product family includes a broadly diversified range of solutions for investors of all experience levels to meet their investment objectives in a variety of market conditions. Global X has more than $30 billion of assets under management and 122 ETFs listed on major Canadian stock exchanges. Global X is a wholly owned subsidiary of the Mirae Asset Financial Group, which manages more than $800 billion of assets across 19 countries and global markets around the world.
For investor inquiries:
Please contact Global X at 1-866-641-5739 (toll-free) or (416) 933-5745
For media inquiries:
Contact Jonathan McGuire
Vice President, Communications
Global X Investments Canada Inc.
(647) 289-3324
[email protected]
Commissions, management fees, and expenses all may be associated with an investment in products (the “Global X Funds”) managed by Global X Investments Canada Inc. The Global X Funds are not guaranteed, their values change frequently and past performance may not be repeated. Certain Global X Funds may have exposure to leveraged investment techniques that magnify gains and losses which may result in greater volatility in value and could be subject to aggressive investment risk and price volatility risk. Such risks are described in the prospectus. The Global X Money Market Funds are not covered by the Canada Deposit Insurance Corporation, the Federal Deposit Insurance Corporation, or any other government deposit insurer. There can be no assurances that the money market fund will be able to maintain its net asset value per security at a constant amount or that the full amount of your investment in the Funds will be returned to you. Past performance may not be repeated. The prospectus contains important detailed information about the Global X Funds. Please read the relevant prospectus before investing.
The Global X ETFs are not sponsored, endorsed, sold, or promoted by S&P, TSX, NASDAQ MX Group, or Morningstar and their affiliated companies and none of these parties make any representation, warranty, or condition regarding the advisability of buying, selling or holding units shares in the Global X ETFs. All trademarks/service marks are registered by their respective owners. None of the owners thereof or any of their affiliates sponsor, endorse, sell, promote or make any representation regarding the advisability of investing in the Global X ETFs. Complete trademark and service-mark information are available at https://www.globalx.ca/disclaimers.
Standard & Poor’s®” and “S&P®” are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”) and have been licensed for use by Global X Investments Canada Inc. (“Global X”) The Global X ETFs are not sponsored, endorsed, sold or promoted by S&P, and S&P makes no representation, warranty or condition regarding the advisability of buying, selling or holding units/shares in the Global X ETFs.
Nasdaq®, Nasdaq-100®, and Nasdaq-100 Index® are trademarks of The Nasdaq Stock Market, Inc. (which with its affiliates is referred to as the “Corporations”) and are licensed for use by Global X Investments Canada Inc. The Product(s) have not been passed on by the Corporations as to their legality or suitability. The Product(s) are not issued, endorsed, sold, or promoted by the Corporations. THE CORPORATIONS MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO THE PRODUCT(S).
The funds or securities referred to herein are not sponsored, endorsed, or promoted by MSCI, and MSCI bears no liability with respect to any such funds or securities or any index on which such funds or securities are based. The prospectus contains a more detailed description of the limited relationship MSCI has with Global X Investments Canada Inc. (“Global X”) and any related funds.
Certain statements may constitute a forward-looking statement, including those identified by the expression “expect” and similar expressions (including grammatical variations thereof). The forward-looking statements are not historical facts but reflect the author’s current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. These and other factors should be considered carefully and readers should not place undue reliance on such forward-looking statements. These forward-looking statements are made as of the date hereof and the authors do not undertake to update any forward-looking statement that is contained herein, whether as a result of new information, future events or otherwise, unless required by applicable law.
Global X Investments Canada Inc. (“Global X”) is a wholly owned subsidiary of Mirae Asset Global Investments Co., Ltd. (“Mirae Asset”), the Korea-based asset management entity of Mirae Asset Financial Group. Global X is a corporation existing under the laws of Canada and is the manager and investment manager of the Global X Funds.
© 2024 Global X Investments Canada Inc. All Rights Reserved.
Categories: News, Press Releases