Horizons cuts fees on three thematic technology ETFs

Nov 6th, 2019 | By | Category: Equities

Horizons ETFs Canada has reduced the management fee on three of its thematic equity ETFs.

Steve Hawkins, President and CEO of Horizons ETFs.

Steve Hawkins, President and CEO of Horizons ETFs.

The Horizons Blockchain Technology & Hardware ETF (BKCH CN) and the Horizons Industry 4.0 Index ETF (FOUR CN) have had their management expense ratios (MERs) trimmed from 0.65% to 0.45%, while the Horizons Robotics and Automation Index ETF (RBOT CN) has been cut from 0.68% to 0.45%.

The funds target the themes of blockchain technology, so-called ‘industry 4.0’, and robotics and automation.

The funds collectively house around C$100 million, although the majority of assets sit within the robotics and automation ETF.

Steve Hawkins, President and CEO of Horizons ETFs, commented, “At Horizons ETFs, we have made a strong commitment to offering Canadian investors ETFs that can provide exposure to important transformative technologies such as blockchain, robotics, artificial intelligence and other important technologies involved in the latest industrial revolution.

“For all of these ETFs, we have implemented significant management fee reductions to align the ETFs in our line-up and to further enhance their appeal for investors seeking to invest in the long-term growth potential of these technologies.”

Blockchain technology

The Horizons Blockchain Technology & Hardware ETF launched in June 2018 and provides targeted access to blockchain technology companies via the Solactive Blockchain Technology & Hardware Index.

The index follows global companies focusing on blockchain innovation and development, as well as companies providing hardware and hardware-related services used in the process of mining, an essential part of blockchain functionality.

Industry 4.0

The Horizons Industry 4.0 Index ETF launched in November 2018. Linked to the Solactive Industry 4.0 Index, the fund provides exposure to developed market companies from five disruptive technology sectors: advanced robotics, augmented reality & 3D printing, cloud & big data, cybersecurity and ‘internet of things’.

The methodology uses FactSet’s Revere Business Industry Classification System (RBICS) to identify firms operating within the five sectors. For each of the five sectors, the index selects the top ten companies based on market capitalization (except for the ‘internet of things’ sector where constituents are chosen based on the highest R&D-to-sales ratio).

The five categories are equally weighted, as are the individual components.

Robotics and automation

The Horizons Robotics and Automation Index ETF launched in December 2017.

While the fund originally tracked the ROBO Global Robotics and Automation Index, it switched to the Indxx Global Robotics & Artificial Intelligence Thematic Index in July 2018.

The new index identifies developed market companies that derive revenue from at least one of four sectors – industrial robots and automation, unmanned vehicles and drones, non-industrial robotics, and artificial intelligence. The index seeks to select the largest 100 firms deriving greater than 50% of their revenue from the above sub-themes.

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