Toronto-based investment manager Lysander Funds has made its ETF debut with the launch of two actively managed fixed income funds.
Richard Usher-Jones, President of Lysander Funds.
The Lysander-Canso Corporate Treasury ActivETF (LYCT CN) and Lysander-Canso Floating Rate ActivETF (LYFR CN) have been listed on the Toronto Stock Exchange.
The funds are sub-advised by Canso Investment Counsel, one of the largest speciality managers of corporate bond portfolios in Canada with over $24 billion in assets under management.
Both ETFs make distributions to investors on a monthly basis.
Richard Usher-Jones, President of Lysander Funds, said: “Lysander is excited to bring the investment expertise of the Canso team to the ETF space by continuing to work closely with advisors across the country.”
Corporate Treasury
The Lysander-Canso Corporate Treasury ActivETF invests primarily in short-term fixed income and floating rate debt securities of government, corporate, and agency issuers worldwide that are rated BBB or higher. It may, to a lesser extent, also invest in convertible securities. The weighted average term to maturity of the ETF’s portfolio will be approximately eighteen months.
Lysander takes a “bottom-up” approach to portfolio construction, focusing on security selection and then adjusting the portfolio to stay within its duration and credit targets. The exact exposure to credit risk depends on the phase of the credit cycle and the bottom-up valuation of individual securities.
The ETF is currently yielding 3.1% with an effective duration of 0.3 years.
The fund comes with a management fee of 0.25%.
Floating rate
The Lysander-Canso Floating Rate ActivETF, meanwhile, invests primarily in floating rate securities of government and corporate issuers worldwide. No more than a quarter of the fund’s total exposure may be allocated to issuers with ratings below BBB. The weighted average term-to-maturity of the portfolio will be less than five years.
Lysander utilizes a similar bottom-up approach to portfolio construction.
The ETF is currently yielding 4.5% with an effective duration of 1.2 years.
The fund’s management fee is 0.35%.