First Asset Investment Management has launched two actively managed exchange-traded funds – the First Asset Active Canadian REIT ETF and the First Asset Active Canadian Dividend ETF.
The ETFs will be actively managed by First Asset's portfolio management team. Lee Goldman, senior vice president and portfolio manager, will be heading up the First Asset Active Canadian REIT ETF.
Manash Goswami, portfolio manager, is the lead manager for First Asset Active Canadian Dividend ETF.
First Asset Active Canadian REIT ETF seeks to build a portfolio of Canadian real estate investment trusts (REITs) and real estate operating corporations (REOCs) that offer attractive yields, backed by predictable, recurring cash flow and are well-positioned for capital appreciation.
"Canadian property fundamentals have remained very solid over the last few years across most real estate asset classes, with high occupancy rates and generally rising rents. This should lead to healthy cash flow growth, which combined with well supported distribution yields in the five to six per cent range, provides a very good return profile for the sector," says Goldman. "Government bond yields have drifted lower this year, providing additional support for valuations and lower borrowing costs for the REITs."
First Asset Active Canadian Dividend ETF takes a fundamental approach to investing, with emphasis on companies with sustainable, strong free cash flow, opportunity for dividend growth and poised for capital appreciation.
"Dividends have been a key component of overall total return throughout the years and will continue to be important as investors seek alternatives to other income products such as government bonds, which are at historically low yields," says Goswami. "First Asset targets companies with strong free cash flow generation and the ability to sustain and grow dividends."