exchange traded funds. exchange traded funds (etf) trade just like stocks trade just like stocks...
TRANSCRIPT
Exchange Traded FundsExchange Traded Funds
Exchange Traded Funds (ETF)Exchange Traded Funds (ETF)
Trade just like stocksTrade just like stocks Quick and easy to invest inQuick and easy to invest in Investor has the choice of which asset class to Investor has the choice of which asset class to
invest ininvest in Key differences between ETFs and Mutual Key differences between ETFs and Mutual
Funds are:Funds are: The hours ETFs are tradedThe hours ETFs are traded The price changes of ETFsThe price changes of ETFs
Exchange Traded Funds (con’t)Exchange Traded Funds (con’t)
ETFs are used to reduce firm specific riskETFs are used to reduce firm specific risk ETFs state legal ownership to stocksETFs state legal ownership to stocks An ETF officially begins with a market makerAn ETF officially begins with a market maker
These middlemen assemble the appropriate basket of These middlemen assemble the appropriate basket of stocks stocks
The fund manager takes a small fee of the funds annual The fund manager takes a small fee of the funds annual assets assets
S&P 60 Index Fund - XIUS&P 60 Index Fund - XIU
Comprised of 60 largest and Comprised of 60 largest and most liquid securities on most liquid securities on TSX.TSX.
Suited for individual Suited for individual investor due to the smaller investor due to the smaller contract sizecontract size
Barclays Canada receives a Barclays Canada receives a fee for acting as a trusteefee for acting as a trustee
S&P 60 Index Fund (con’t)S&P 60 Index Fund (con’t)
XIU options allow speculators a better XIU options allow speculators a better opportunity with a limited and known amount opportunity with a limited and known amount of risk.of risk.
S&P Capped Composite Index S&P Capped Composite Index Fund - XIC Fund - XIC
Long-term capital growthLong-term capital growth Comprised of largest and most Comprised of largest and most
liquid securities on TSX and liquid securities on TSX and other ishares fundsother ishares funds
S & P uses industrial S & P uses industrial classifications and guidelines for classifications and guidelines for selecting securitiesselecting securities
10% cap on issuers10% cap on issuers Susceptible to same risks as Susceptible to same risks as
Canadian Equity Fund IndexCanadian Equity Fund Index
S&P Capped Composite Index Fund S&P Capped Composite Index Fund (con’t)(con’t)
Replicates underlying index Replicates underlying index Advantages and disadvantages to thisAdvantages and disadvantages to this
S&P Capped Income Trust Index S&P Capped Income Trust Index Fund - XTRFund - XTR
Comprised of securities of Comprised of securities of income trust issuersincome trust issuers
Securities are selected by S&PSecurities are selected by S&P Replicates the performance of the Replicates the performance of the
S&P/TSX Capped Income Trust S&P/TSX Capped Income Trust IndexIndex
Dividend and capital gains Dividend and capital gains distributiondistribution
Annual trustee fee is 0.55%Annual trustee fee is 0.55% Governed by a trust agreementGoverned by a trust agreement
S&P Capped Income Trust Index S&P Capped Income Trust Index Fund (con’t)Fund (con’t)
Seek to minimize riskSeek to minimize risk Some risks involvedSome risks involved
Sector riskSector risk FluctuationFluctuation
Thank youThank you
Any Question?Any Question?