Skip To Main Content
News

Horizons ETFs Launching Premium Yield Suite

29/09/23 - 12:22 am

New ETFs offer U.S. Treasury exposure with active options program for higher yields

TORONTO – September 29, 2023 – Horizons ETFs Management (Canada) Inc. (“Horizons ETFs” or the “Manager”) is pleased to announce that it is launching three new ETFs (the “ETFs”) as part of its Premium Yield suite (the “Premium Yield Suite”) – a unique ETF family that uses an actively-managed options program with varied levels of duration that seeks to generate higher yields and may offer tax-efficient distributions on U.S. Treasury securities.

With our upcoming Premium Yield Suite, we’ll provide an opportunity for portfolio security in the search for significant yield,” said Rohit Mehta, President and CEO of Horizons ETFs. “With an underlying portfolio of U.S. Treasury securities backed by the credit of the U.S. government coupled with an actively managed options program driven by our expertise in the field, our Premium Yield ETFs will seek to offer peace of mind and meaningful monthly income for investors.”  

Units of the ETFs have been conditionally approved for listing by the Toronto Stock Exchange (“TSX”) and are slated to begin trading on October 5, 2023. The ETFs will be offered in both Canadian dollar and U.S. dollar versions and are further described in the table below:

ETF Name and TickerInvestment ObjectiveTarget DurationMgmt
Fee*
Initial Target Annualized Net Yield¹
Horizons Short-Term U.S. Treasury Premium Yield ETF (“SPAY.U” and “SPAY”)SPAY.U seeks to provide: (a) exposure to the performance of a portfolio of U.S. Treasury securities, 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, SPAY.U will employ a dynamic option program.Less than
3 years
0.35%7.5%
Horizons Mid-Term U.S. Treasury Premium Yield ETF (“MPAY.U” and “MPAY”)MPAY.U seeks to provide: (a) exposure to the performance of a portfolio of U.S. Treasury securities, generally targeting a duration between 5 and 10 years; and (b) high monthly distributions of interest income and option premiums. To generate premiums and reduce volatility, MPAY.U will employ a dynamic option program5 to 10 Years0.40%9.0%
Horizons Long-Term U.S. Treasury Premium Yield ETF (“LPAY.U” and “LPAY”)LPAY.U seeks to provide: (a) exposure to the performance of a portfolio of U.S. Treasury securities, generally targeting a duration over 10 years; and (b) high monthly distributions of interest income and option premiums. To generate premiums and reduce volatility, LPAY.U will employ a dynamic option program.10+ Years0.45%10.5%

Horizons ETFs’ Premium Yield Suite offers Canadians the ability to choose their duration exposure with U.S. Treasuries and an actively-managed options program: short or less than 3 years via SPAY, medium or 5 to 10 years via MPAY, and long or 10+ years via LPAY.

As part of its options writing program for the ETFs, the Manager will use both puts and calls to reduce downside risk and improve upside capture, based on market conditions. This strategy aims to balance target duration and income potential across interest rate and interest rate volatility environments. The use of both puts and calls on a U.S. Treasuries portfolio offers greater flexibility and adaptability through all market conditions.

Whether you’re cautious about the current interest rate environment or believe that there’s an opportunity to take advantage of the recent pause in the hiking cycle, our Premium Yield Suite will offer a duration and yield that can work for you and your monthly income needs,” said Mr. Mehta. “And with the premiums generated from option writing expected to be treated as capital gains, these ETFs could offer tax-efficient yield enhancement to your portfolio, too.

The ETFs are expected to close their initial offering of units to their designated broker on October 4, 2023, and are expected to begin trading when the market opens on October 5, 2023.

For further information about the ETFs ahead of launch, please visit:

About Horizons ETFs Management (Canada) Inc. (www.HorizonsETFs.com)
Horizons ETFs Management (Canada) Inc. is an innovative financial services company with one of the largest suites of exchange traded funds in Canada. The Horizons ETFs 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. Horizons ETFs currently has more than $27 billion of assets under management and 110 ETFs listed on major Canadian stock exchanges. Horizons ETFs is a wholly owned subsidiary of the Mirae Asset Financial Group, which manages approximately $710 billion of assets across 13 countries around the world. 

Investor inquiries:
Contact Horizons ETFs at 1-866-641-5739 (toll-free) or (416) 933-5745
info@horizonsetfs.com 

Media inquiries:
Contact Naseem Husain
Senior Vice President, ETF Strategist
Horizons ETFs Management (Canada) Inc.
nhusain@horizonsetfs.com

Discover Our Approach To Thematic Investing thematicInvesting

FEATURED ETFs

PAYS Global X Short-Term Government Bond Premium Yield ETF 
SPAY Global X Short-Term U.S. Treasury Premium Yield ETF
SPAY.U Global X Short-Term U.S. Treasury Premium Yield ETF
UBIL.U Global X 0-3 Month U.S. T-Bill ETF
UCSH.U Global X USD High Interest Savings ETF
HYBR Global X Active Hybrid Bond and Preferred Share ETF
MPAY.U Global X Mid-Term U.S. Treasury Premium Yield ETF
MPAY Global X Mid-Term U.S. Treasury Premium Yield ETF
LPAY.U Global X Long-Term U.S. Treasury Premium Yield ETF
LPAY Global X Long-Term U.S. Treasury Premium Yield ETF
HPR Global X Active Preferred Share ETF
HSAV Global X Cash Maximizer Corporate Class ETF
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.

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, investment manager and trustee of the Global X Funds.

© 2024 Global X Investments Canada Inc. All Rights Reserved.