New fixed income Invesco ETF launches on Neo

Sep 27th, 2017 | By | Category: Fixed Income

PowerShares Canada has launched the PowerShares 1-10 Year Laddered Investment Grade Corporate Bond Index ETF (PIB) on the NEO Exchange. As the name suggests, the ETF gives exposure to Canadian investment grade corporate bonds.

New fixed income Invesco ETF launches on Neo

The launch brings the total number of ETFs listed by PowerShares Canada on the NEO exchange to four.

Christopher Doll, vice president, product and business strategy, PowerShares Canada, commented: “This new ETF is designed to provide investors with low-risk growth through exposure to primary Canadian investment-grade corporate bonds. We are pleased to be adding another NEO-listed product to our line-up as we continue to implement our multi-venue listing strategy, that ultimately provides greater efficiency and cost savings for our clients.”

The ETF tracks the FTSE TMX Canada Investment Grade 1-10 Year Laddered Corporate Bond Index, which equally weights Canadian firms’ debt. For inclusion in the index, securities must be rated BBB or higher, and have a minimum issue size of $300m. As bonds in the portfolio approach maturity, the proceeds are reinvested in securities with a time to maturity of between 9-10 years, a process known as ‘laddering’.

This marks the third time Invesco has selected NEO as its listing exchange to launch new funds, bringing the number of PowerShares ETFs listed on NEO to four. After two years of full operation, NEO is now home to 25 funds, comprised of 42 different symbols from six ETF providers. In August 2017, NEO facilitated close to 20% of all ETF volume traded in Canada, with about half in continuous trading.

Jos Schmitt, president and CEO of NEO Exchange, said: “PowerShares has proven to be an exceptional partner from our inception because of their belief and dedication to a better Canadian capital market landscape for all investors.

“We are delighted to see PowerShares renew its commitment to NEO today, not on the strength of our relationship, but on the strength of our service and ability to promote liquidity for, and access to, investment products. PowerShares’ decision to return to us speaks to the growing momentum we have been building in both ETF listings and ETF volume traded.”

The ETF has a management expense ratio of 0.25%.

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