Liquid alternative fixed income strategy will be sub-advised by DMAT Capital, a new firm founded by Barry Allan
TORONTO, Dec. 7, 2020 /CNW/ – Horizons ETFs Management (Canada) Inc. (“Horizons ETFs“) is pleased to announce the launch of the Horizons Tactical Absolute Return Bond ETF (“HARB” or the “ETF“). The two different series of shares of the ETF will begin trading tomorrow, December 8, on the Toronto Stock Exchange (“TSX“) under the ticker symbols HARB (Total Return Series Shares) and HARB.J (Dividend Series Shares).
HARB seeks to provide positive absolute returns with low volatility over a market cycle regardless of market conditions or general market direction. The ETF will tactically take long and short positions in North American and global debt instruments and derivatives across the credit spectrum. In respect of the Dividend Series Shares, the ETF will also seek to provide consistent income.
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ETF Name
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Tickers
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Horizons Tactical Absolute Return Bond ETF
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HARB; HARB.J
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The ETF is sub-advised by DMAT Capital Management (“DMAT Capital“), a boutique portfolio management firm founded by Barry Allan, a renowned Canadian fixed income manager. Mr. Allan is the President, CEO and CIO of DMAT, and has over 38 years of industry experience running investment mandates across the full spectrum of the fixed income world, including government bonds, investment-grade bonds, high-yield bonds and distressed bonds.
“HARB is the first fixed income ETF offered by Horizons that is what we would refer to as a ‘liquid alternative.’ This is an ETF that will utilize a variety of long and short fixed income investment strategies to seek absolute returns regardless of the conditions of the capital markets,” said Steve Hawkins, President and CEO of Horizons ETFs. “With its ‘go anywhere’ mandate, backed by the experienced management of Barry Allan and his DMATCapital team, HARB will seek to identify and target potential opportunities across the fixed income universe as markets move.”
The ETF was constructed within the Horizons ETF Corp., a corporate class mutual fund structure that allows HARB to deliver its returns in a tax-efficient manner. HARB is available in two different series of shares of ETFs: HARB:TSX, the Total Return Series Shares, and HARB.J:TSX, the Dividend Series Shares.
HARB, the Total Return Series Shares, is not expected to make regular distributions and is particularly advantageous if held in a taxable account, where tax on bond income distributions could potentially be in excess of 50% depending on the marginal rate of tax of the investor. HARB.J, the Dividend Series Shares, has an initial distribution rate target of 5.0% per annum, which are anticipated to be paid monthly, and may consist of dividends, capital gains and/or returns of capital.
The ETF can take long or short positions, using leverage up to three-times (300%) of its net asset value, across a variety of North American and global income-producing instruments including but not limited to: government debt, corporate debt, preferred shares, fixed income derivatives, and other income-producing instruments, as part of a variety of sophisticated strategies.
“The fixed income landscape has changed substantially in 2020. To find appreciable yield, you need to be able to alter your duration, credit quality and liquidity to take advantage of all market conditions in real-time,” said Barry Allan, CEO of DMAT Capital. “The flexibility of HARB allows us to focus our portfolio positioning to seek to deliver the highest absolute and risk-adjusted return profile over the course of the investment cycle, while being able to respond and protect capital during periods of rising yields and widening spreads.”
HARB and HARB.J have closed their initial offering of shares and will begin trading on the TSX when the market opens tomorrow morning. Please refer to the prospectus and/or our website for more information about the ETF.
About DMAT Capital Management
DMAT is a boutique portfolio management firm founded by renowned Canadian fixed income manager, Barry Allan, who has nearly 40 years of industry experience running investment mandates involved in the full spectrum of the fixed income world, from government bonds, investment-grade bonds, high-yield bonds and distressed bonds. DMAT currently has a team of four investment professionals, led by Mr. Allan, that specialize in creating specialized and non-traditional fixed income strategies designed to meet the needs of Canadian financial advisors and their high-net-worth clientele.
About Horizons ETFs Management (Canada) Inc. (
www.HorizonsETFs.com
)
Horizons ETFs Management (Canada) Inc. is an innovative financial services company and offers one of the largest suites of exchange traded funds in Canada. The Horizons ETFs product family includes a broadly diversified range of solutions for investors of all experience levels to meet their investment objectives in a variety of market conditions. Horizons ETFs currently has over $16 billion of assets under management and 94 ETFs listed on major Canadian stock exchanges.
Commissions, management fees and expenses all may be associated with an investment in Horizons Tactical Absolute Return Bond ETF (“the ETF”) managed by Horizons ETFs Management (Canada) Inc. The ETF is an alternative mutual fund within the meaning of National instrument 81-102, Investment Funds, and is permitted to use strategies generally prohibited by conventional mutual funds and ETFs, such as borrowing cash, selling securities short, and employing leverage of up to 300%, amongst others. The use of these strategies may accelerate the risk associated with the ETF. The ETF Is not guaranteed, its values change frequently and past performance may not be repeated. The prospectus contains important detailed information about the ETF. Please read the prospectus and its risk disclosure before investing.
SOURCE Horizons ETFs Management (Canada) Inc.
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