First Asset Energy Giants Covered Call ETF: Combining the Largest Energy Producers in the World with Higher Cash Flow
TORONTO, Feb. 10, 2015 /CNW/ - First Asset Investment Management Inc. is pleased to announce the launch of First Asset Energy Giants Covered Call ETF (TMX: NXF). NXF invests on an equal weight basis in a portfolio of equity securities of the 15 largest non-Canadian oil and gas exploration and production companies measured by $USD market capitalization with common stock or ADRs listed on a Canadian or U.S. stock exchange, and employs a covered call option writing program on approximately, and not more than, 25% of the securities of each portfolio issuer. NXF is designed to provide investors with quarterly cash distributions, the opportunity for capital appreciation and lower overall volatility of returns on the portfolio than would be experienced by owning a portfolio of securities of such issuers directly. NXF’s portfolio will be rebalanced to equal weight at the end of each calendar quarter. Units of NXF are available in currency hedged and unhedged versions.
"NXF represents another example of how First Asset is trying to meet the real world needs of Canadian investors. We excluded Canadian energy producers to avoid replicating exposure that most Canadians already have, and combined equal weighted exposure to the portfolio of energy giants with our 25% covered call writing strategy. The result is a way to invest in large cap energy companies with the benefits of writing covered call options on a portion of the portfolio – a balance of market participation with option premiums. We believe it represents another smart solution for Canadian advisors to help achieve their clients` objectives.
Barry Gordon, President and CEO, First Asset Investment Management Inc.
Call Options - An attractive risk adjusted approach
Large capitalization energy producers are expected to be attractive long-term investments, but may exhibit significant price volatility for the foreseeable future. Accordingly, the Manager believes that an investment strategy which incorporates equal weighting combined with selling call options is a balanced approach that will offer the potential to capitalize on the sector volatility while retaining the upside on a significant portion of the portfolio.
A similar methodology has been successfully applied by First Asset to a portfolio of the 25 largest North American technology companies. First Asset Tech Giants Covered Call ETF (TMX:TXF, launched in October 2011) has achieved compound annual total returns of 13.87% since inception to Jan 30, 2015, and has an attractive distribution yield of 6.05% as at December 31, 2014.
|First Asset Tech Giants Covered Call ETF (TXF)||1 year||2 year||3 year||Since
The indicated rates of return are the historical annual compounded total returns, including changes in unit value and do not take into account sales, redemption or optional charges or income taxes payable by a security holder that would have reduced returns. Exchange traded funds are not guaranteed, their values change frequently and past performance may not be repeated. As the underlying portfolio holdings of TXF and NXF are not the same, their performance will differ. The distribution yield of TXF is calculated on the Fund's actual distributions paid to investors over the past 12 months based on NAV. All distributions are paid in cash.
|First Asset Giants ETFs||TSX Ticker Symbols|
|Common Units||Advisor Units|
|First Asset Tech Giants Covered Call ETF||TXF||TXF.A|
|New: First Asset Energy Giants Covered Call ETF||NXF||NXF.A|
First Asset Energy Giants Covered Call ETF has closed the initial offering of its currency hedged and unhedged common class units and currency hedged and unhedged advisor units and these units will begin trading on the Toronto Stock Exchange ("TSX") today.
First Asset - Smart SolutionsTM
First Asset is an independent investment firm, focused on providing smart, low cost solutions that address the real-world investment needs of Canadians - capital appreciation, income generation and risk mitigation. Rooted in strong fundamentals, First Asset’s smart solutions strive to deliver better risk-adjusted returns than the broad market while helping investors achieve their personal financial goals.
First Asset’s comprehensive suite of 37 ETFs allow advisors to construct smart, well diversified and good risk adjusted client portfolios. For further information, please contact Investor Relations, First Asset Investment Management Inc. at 416-642-1289 or 1-877-642-1289 or visit www.firstasset.com.
This communication is intended for informational purposes only. This offering is made only by prospectus. The prospectus contains important detailed information about the First Asset ETF and its units. A copy of the prospectus may be obtained from your investment advisor, First Asset or at www.sedar.com. Investors should read the prospectus before making an investment decision. Commissions, trailing fees, management fees and expenses all may be associated with investments in the First Asset ETF. The First Asset ETF is managed by First Asset Investment Management Inc.
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