Canada’s ETF Scene Heats Up: Active, Leveraged, and Gold Strategies Make Waves

Canada’s ETF Scene Heats Up: Active, Leveraged, and Gold Strategies Make Waves

  • 03.06.2025 05:16
  • theglobeandmail.com
  • Keywords: ETF Innovation, Active Management, Leveraged Funds, Gold Exposure

Canada’s ETF market is experiencing growth with new offerings from Manulife, LongPoint, and BMO. These include active management strategies, leveraged ETFs, and gold-focused funds, addressing investor demand for specialized investment tools.

MicroStrategy Products
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Estimated market influence

Manulife Investment Management

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Analyst rating: N/A

rolled out four new ETF series targeting fixed income and equity with active management focus on income and quality growth

LongPoint Asset Management

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Analyst rating: N/A

launched Canada’s first locally listed 3X leveraged and inverse ETFs, offering amplified exposure to major indices and sectors

BMO Asset Management

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Analyst rating: N/A

introduced a new suite of actively managed ETFs shaped by the insights of Brian Belski, Chief Investment Strategist at BMO Capital Markets

Context

Canada’s ETF Market Innovation: A Comprehensive Analysis

Manulife's Launch of Active ETFs

  • Four new ETF series introduced, repackaging mutual fund strategies into low-cost, intraday-traded vehicles.
  • Focus areas: Fixed income and equity.
    • Fixed Income ETF: Blends government and corporate bonds across credit tiers for optimized returns with risk management.
    • Equity Funds:
      • Globally diversified strategy targeting dividend growers with strong business models.
      • Canadian-focused equity fund for domestic investors.
      • Monthly income ETF from a mix of Canadian, U.S., and global dividend payers.

LongPoint’s Triple-Leveraged ETFs

  • First triple-leveraged ETFs in Canada offering 3x and inverse exposure.
  • Target indices include:
    • Canadian banks (BNKU).
    • Canadian gold miners (CGMU).
    • Long-duration U.S. Treasuries (TLTU).
  • Proposed single-stock ETFs:
    • COIU CN for Coinbase.
    • MSTU CN for MicroStrategy.
  • Management fee: 1.55%.

BMO’s Strategic ETF Suite

  • Actively managed ETFs led by Brian Belski, Chief Investment Strategist.
  • Diversified funds:
    • Equity and fixed income blend.
    • U.S.-tilted options with hedged and unhedged units for currency risk management.
  • Gold Income Strategy ETF (ZWGD):
    • Provides exposure to long-term gold bullion.
    • Generates income through covered call spreads for yield and downside protection.

Market Trends and Implications

  • Innovation: Increased focus on tailored, outcome-driven ETFs.
  • Competition: issuers offering diverse strategies to meet investor demand for specialized products.
  • Regulatory Considerations: Potential scrutiny on leveraged ETFs due to high risk.

Competitive Dynamics

  • Manulife: Targets income-focused investors with low-cost solutions.
  • LongPoint: Attracts high-risk traders with leveraged single-stock exposure.
  • BMO: Focuses on strategic and gold income investors.

Strategic Considerations

  • Each issuer addresses specific investor needs, enhancing market options.
  • Potential risks associated with leveraged products may influence regulatory actions.

This structured analysis highlights the evolving Canadian ETF landscape, emphasizing innovation and strategic differentiation among key players.