BMO Asset Management Inc has launched the BMO Canadian Bank Income Index ETF.
The firm writes that this ETF expands its suite of fixed income ETFs to include a unique solution investing in non-traditional securities such as preferred shares and LRCNs while remaining anchored with traditional Canadian bank fixed income.
“Amid an environment of rising inflation and interest rates, investors are looking for innovative solutions that behave differently than traditional fixed income products,” says Mark Raes, Head of Product (Canada), BMO Global Asset Management.
“BMO’s new ZBI ETF gives investors access to yield enhancing segments of the bank funding market – including LRCNs and preferred shares combined with holdings of Bank bonds – resulting in shorter duration and higher yield than the aggregate fixed income market.”
BMO Canadian Bank Income Index ETF (ZBI) seeks to replicate the performance of Solactive Canadian Bank Income Index, a portfolio of traditional and non-traditional Canadian bank debt instruments including LRCNs and preferred shares.