|By PR Newswire||
|March 24, 2014 02:00 PM EDT||
TORONTO, March 24, 2014 /CNW/ - PowerShares Canada today announced changes to the investment strategy of PowerShares Canadian Preferred Share Index Class and PowerShares Canadian Preferred Share Index ETF ("PPS").
In 2013, The NASDAQ OMX Group, Inc. ("NASDAQ") acquired the index business of Mergent, Inc., including Indxis, which created and maintained the underlying index for both PowerShares Canadian Preferred Share Index Class and PPS.
Following the acquisition, NASDAQ reviewed its indices, and has announced enhancements to its NASDAQ Select Canadian Preferred ShareTM Index, which is the underlying index of both PPS and PowerShares Canadian Preferred Share Index Class.
"After significant review, NASDAQ has determined to update the index methodology for NASDAQ Select Canadian Preferred ShareTM Index in order to bring a more robust approach to the market," said Dave Gedeon, managing director, NASDAQ OMX Global Indexes. "We are updating the methodology with a focus on index size and selection, and believe the resulting index with high-yield and low-volatility screens will serve as a better benchmark for the Canadian market."
"The improvements made to the underlying index reflect NASDAQ and PowerShares Canada's continued commitment to providing access to smart beta strategies for Canadian investors," said Michael Cooke, Head of Distribution, PowerShares Canada.
The previous index methodology had applied liquidity and market-capitalization screens to narrow the investable universe, from which the 50 most liquid securities were selected for index inclusion.
Effective Thursday, May 1, 2014, the index will include 100 securities, with selection based on the highest combined weight of high yield and low volatility. The new methodology maintains the liquidity screen and continues to weight by market capitalization.
PowerShares Canada also announced that it has reduced the management fee on PowerShares FTSE RAFI U.S. Fundamental (CAD Hedged) Index ETF ("PXU"). Effective March 28, 2014, the management fee will be reduced from 60 basis points (bps) to 55 bps.
The effective management fee for PXU has been 55 bps since its inception on January 26, 2012, when an ongoing discretionary waiver of five bps was implemented. To provide investors with more clarity, that waiver has been cancelled and the fee reduced permanently.
In a related announcement, PowerShares Canada will rename PowerShares Ultra DLUX Long Term Government Bond Index ETF (PGL) as PowerShares Ultra Liquid Long Term Government Bond Index ETF (PGL) effective April 15, 2014. The name change reflects the new name of its underlying index; however, the index methodology is unchanged.
The DEX Ultra DLUX Long Government Bond Index was renamed FTSE TMX Canada Ultra Liquid Long Term Government Bond Index. That name change resulted from the merger of the fixed-income index businesses of TMX Datalinx and FTSE Group.
To learn more about TSX-listed PowerShares exchange-traded funds (ETFs), including the full methodology of the NASDAQ Select Canadian Preferred Share Index, please visit www.powershares.ca.
About Invesco Canada Ltd.
Invesco Canada Ltd., operating under three distinct yet complementary product brands (Trimark, Invesco and PowerShares), is one of Canada's leading investment management companies. A subsidiary of Invesco Ltd., Invesco Canada's singular focus is on investment management, offering a diversified suite of solutions to institutions, organizations, companies and individual investors across Canada and around the world. Additional information is available at www.invesco.ca.
About Invesco Ltd.
Invesco Ltd. is a leading independent global investment management firm dedicated to helping investors worldwide achieve their financial objectives. By delivering the combined power of our distinctive investment management capabilities, Invesco provides a wide range of investment strategies and vehicles to our clients around the world. Operating in more than 20 countries, the firm is listed on the New York Stock Exchange under the symbol IVZ. Additional information is available at www.invesco.com.
Commissions, management fees and expenses may all be associated with investments in mutual funds and ETFs. Trailing commissions may be associated with investments in mutual funds. Mutual funds and ETFs are not guaranteed, their values change frequently and past performance may not be repeated. There are risks involved with investing in ETFs and mutual funds. Please read the prospectus for a complete description of risks. Copies are available from Invesco Canada Ltd. at www.powershares.ca. Ordinary brokerage commissions apply to purchases and sales of ETF units.
Most PowerShares ETFs seek to replicate, before fees and expenses, the performance of the applicable index, and are not actively managed. This means that the sub-advisor will not attempt to take defensive positions in declining markets and the ETF will continue to provide exposure to each of the securities in the index regardless of whether the financial condition of one or more issuers of securities in the index deteriorates. In contrast, if a PowerShares ETF is actively managed, then the sub-advisor has discretion to adjust that PowerShares ETF's holdings in accordance with the ETF's investment objectives and strategies.
ETFs are not diversified investments.
NASDAQ Select Canadian Preferred Share Index has been licensed for use by Invesco Canada Ltd. The product is not sponsored, endorsed, sold or promoted by NASDAQ OMX, and NASDAQ OMX makes no representation regarding the advisability of investing in PowerShares Canadian Preferred Share Index ETF.
NASDAQ®, OMX®, NASDAQ OMX® are trade/service marks of The NASDAQ OMX Group, Inc. (which with its affiliates is referred to as the "Corporations") and are used under licence to PowerShares Capital Management LLC and Invesco Canada Ltd. The Product(s) have not been passed on by the Corporations as to their legality or suitability. The Product(s) are not issued, endorsed, sold, or promoted by the Corporations. THE CORPORATIONS MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO THE PRODUCT(S).
FTSE® is a trade mark owned by the London Stock Exchange Group companies and is used by FTSE International Limited ("FTSE") under licence. The FTSE RAFI® Index Series is calculated by FTSE in conjunction with Research Affiliates LLC ("RA"). Neither FTSE nor RA sponsor, endorse or promote this product and are not in any way connected to it and do not accept any liability in relation to its issue, operation and trading. Any intellectual property rights in the index values and constituent list vests in FTSE.
FTSE TMX Canada Ultra Liquid Long Government Bond is a trademark of FTSE TMX Global Debt Capital Markets Inc. The mark has been sublicensed for use for certain purposes to Invesco Canada Ltd. by FTSE TMX Global Debt Capital Markets Inc. PowerShares Ultra Liquid Long Term Government Bond Index ETF (the "Product") is not sponsored, endorsed, sold or promoted by FTSE TMX Global Debt Capital Markets Inc., its affiliates and third party data suppliers. FTSE TMX Global Debt Capital Markets Inc. makes no representation, warranty, or condition regarding the advisability of investing in the Product.
Investors should be aware of the risks associated with data sources and quantitative processes used in our investment management process. Errors may exist in data acquired from third party vendors, the construction of model portfolios, and in coding related to the index and portfolio construction process. While Research Affiliates takes steps to identify data and process errors so as to minimize the potential impact of such errors on index and portfolio performance, we cannot guarantee that such errors will not occur.
"Fundamental Index®" and/or "Research Affiliates Fundamental Index®" and/or "RAFI®" and/or all other RA trademarks, trade names, patented and patent-pending concepts are the exclusive property of Research Affiliates, LLC.
PowerShares Canada is registered business name of Invesco Canada Ltd.
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© Invesco Canada Ltd., 2014
SOURCE Invesco Canada Ltd.