Mackenzie Investments launches smart beta equity ETFs

Jun 24th, 2016 | By | Category: Equities

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Canada-based Mackenzie Financial Corporation (Mackenzie Investments) has launched two smart beta equity exchange-traded funds on the Toronto Stock Exchange offering exposure to US and Canadian equities.

Mackenzie Investments launches smart beta equity ETFs with US and Canada-based exposures

The Mackenzie Maximum Diversification Canada Index ETF and the Mackenzie Maximum Diversification US Index ETF each has a total expense ratio of 0.60%.

Launched in partnership with Paris-based asset management firm TOBAM, the ETFs are designed to act as core portfolio holdings. The funds track the performance of rules-based indices from TOBAM’s Maximum Diversification Index Series. Each index aims to create a more diversified portfolio relative to a market capitalization weighted benchmark.

Yves Choueifaty, CEO of TOBAM and creator of the Maximum Diversification Index Series, said: “Our research indicates that the systematic returns available from equity markets are higher than using market-cap weighted benchmarks’, and seem to be far more stable over time.

“Using a biased benchmark as a reference carries implicit bets, potentially costly, which evolve dynamically. On the contrary, TOBAM’s Maximum Diversification approach is designed to reduce explicit and implicit biases in terms of sector, styles, market cap and to collect the risk premium available in the investment universe. We are very excited to be partnering with Mackenzie Investments to make our strategies available to Canadian investors.”

The Mackenzie Maximum Diversification Canada Index ETF (Toronto: MKC) tracks the TOBAM Maximum Diversification Canada Index, a reference for the broad Canadian equities market.

The Mackenzie Maximum Diversification US Index ETF (Toronto: MUS) tracks the TOBAM Maximum Diversification USA Index, a reference for the broad US equities market.

Each fund has a total expense ratio of 0.60%.

Jeff Carney, President and Chief Executive Officer of Mackenzie Investments, said in a statement: “Mackenzie Investments’ commitment to finding innovative and unique investment solutions in the marketplace has us looking around the globe. TOBAM’s team in Paris brings a unique and differentiated strategy to diversification that we are pleased to offer advisors and investors,”

Michael Cooke, Head of Exchange Traded Funds at Mackenzie Investments, added: “In today’s financial environment, investors are looking for additional ways to position their portfolios to help them keep pace with constantly changing markets….  Our maximum diversification index ETFs represent an exciting new chapter in the evolution of smart beta ETFs in Canada. For investors rethinking their core holdings, these funds aim to enhance diversification that may help achieve superior performance with lower risk over reasonable periods of time.”

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