Canada’s BMO Global Asset Management has entered the exchange-traded fund (ETF) market in Europe with the launch of nine funds including products for the under-served fixed income market.
The firm, which has $244 billion (€227 billion) of assets under management, has launched four corporate bond ETFs with different maturity bands and five income equity funds. All are listed on the London Stock Exchange and aimed at European investors.
BMO GAM is the fastest growing and second largest ETF provider in Canada, according to the firm.
Richard Wilson, chief executive officer of BMO GAM in Europe, the Middle East and Africa, says the ETF launch is a key strategic milestone for the firm and builds on its ETF business in Canada, where BMO GAM manages 60 ETFs, and Hong Kong, where the firm launched three ETFs last year.
The fixed income ETFs offer exposure to global investment grade corporate bonds and high yield bonds, while the five equity ETFs focus on high quality income.
The different maturity bands of the bond ETFs mean that investors can “implement a more precise positioning” across the yield curve, therefore expressing their views on uncertain future interest rates.
The ETFs track the Barclays Very Liquid Index, a subset of the Barclays Global Aggregate Bond Index.
The five equity ETFs form a new range called Income Leaders and track new indices developed with MSCI that list companies that pay higher than average dividend yields.
Kevin Gopaul, head of ETFs at BMO GAM, says: “These are the first ETFs to offer a range of specific global corporate bond maturity bands, allowing investors to position their portfolios more precisely on the yield curve.”
The nine ETFs are listed in sterling and those that invest in non-sterling investments are offered as sterling-hedged funds to mitigate this currency risk.
The ETFs are managed in London and domiciled in Ireland.
©2015 funds europe
