Total assets under management (AUM) in exchange-traded funds (ETFs) recently surpassed the milestone $200-billion mark.
The figure is remarkable for a variety of reasons. Not only is it more than double the $89.5-billion in client assets held in ETFs at year-end 2015, it’s more than 10 times the $19.4-billion in AUM held in ETFs at year-end 2008.
Inflows in ETFs were on pace to surpass those of mutual funds for the second year in a row at year-end. While the $1.6-trillion of client AUM in mutual funds still dwarfs those of ETFs, the trend for the latter is upward. In one year, client assets in ETFs have gone from one-tenth to one-eighth of those in mutual funds.
There is no denying that ETFs have become the go-to investment vehicle for many Canadian financial advisors and investors.
Here are 10 articles on investing strategies using ETFs that were published on Globe Advisor this past year:
Investors seeking the benefits of an income property without the hassles of being a landlord might want to check out real estate investment trusts (REITs). But investors can become even lazier landlords if they own ETFs that hold a basket of REITs. These investments have attractive yields because they distribute most of their taxable income to unit holders.
With central banks putting the brakes on interest rates, income-seeking investors are taking a fresh look at strong dividend-paying stocks. Picking high-yielding stocks can be difficult – as some companies may not be able to continue juicy payouts – so ETFs offer a more diversified way to invest in these securities.
Water is all around us, yet it has tended to flow underground as an investment. That is, until recently, as global attention turns toward changing weather patterns. ETFs with water-related holdings have risen in value by as much as 20 per cent since the beginning of 2019. It’s hard to know exactly why, but some suggest it could be linked to growing interest in the impact of climate change.
It may be wise for investors to take some risk off the table. ETFs, with their diversified exposure to markets, can be one way for investors to hedge their bets. We asked three ETF experts for their top defensive picks.
Canadian investors love their ETFs. As their uptake continues to increase, where can financial advisors expect ETFs to go into 2020? And how can they meet the needs of ETF investors in a changing market?
The ETF death toll is rising as a record number have closed in recent years. Although investors may be dismayed to find out an ETF in their portfolio is scheduled to close, those who follow the industry closely say it hardly comes as a surprise as fund issuers look for spaces that haven’t already been covered by competitors.
For yield-thirsty investors, there’s nothing like a steady pay cheque. Although it’s common for ETFs to pay quarterly distributions, more dividend-oriented funds now offer monthly payouts. These regular payments can help investors manage their cash flow better, provide faster compounding if reinvested and offset losses during market volatility.
Investors seeking a safe haven from recession or market swoons can often find solace in consumer staples stocks. That’s because products such as groceries, toiletries and cleaning supplies are always in demand – even during a difficult economy. Companies in this space often pay healthy dividends and their shares are typically less volatile. However, the risks range from rising interest rates to company-specific challenges. As ETFs offer an easy alternative to choosing stocks, we asked three ETF experts for their top picks in this sector.
When gold glitters, it can take investors by surprise. But while the price of gold is unpredictable, owning it can help diversify a portfolio because it can move in the opposite direction of stock markets. Instead of buying bullion or gold-mining stocks – which can have some weak correlation to the market – ETFs offer easier exposure to the asset.
ETFs have evolved significantly from investments that track broad indexes to a plethora of theme-based plays such as clean energy, currency hedging and social media. ETF providers regularly introduce products that reflect market trends, such as the cannabis ETFs launched in the run-up to Canada’s legalization of recreational marijuana, or the new gender-diversity products focused on companies that show a commitment to putting women on their boards and in top leadership positions.
London Community Foundation tackling lack of housing with $20-million investment – Global News
The London Community Foundation (LCF) is committing up to $20 million to addressing London’s affordable housing crisis.
The funds will be used to create a dedicated affordable housing fund of $17 million to $20 million to support the creation of more affordable housing options in the city.
“Adequate, safe and affordable housing should not be out of reach,” said LCF president and CEO Martha Powell.
“The shortage of affordable housing in our community is at a crisis point.”
London currently has a housing shortage of 3,000 units and more than 2,400 individuals and families accessing emergency shelters each year.
The fund is designed to offer flexible financing for community organizations interested in creating affordable housing.
According to the LCF, a major barrier to entering the affordable housing market is the high startup costs.
LCF is proposing low-interest, early-stage, flexible financing to help groups with initial startup costs like fund assessments, land acquisition, and planning and zoning expenses needed before the first phase of a project can be completed.
This idea builds upon the concept of LCF’s $10-million Social Impact Fund, which has helped to create 341 units of affordable housing.
In addition to the $20-million fund, the foundation announced the establishment of a Housing Action Committee, which will identify organizations that have an interest and capacity to help create affordable housing but who need more information and financial assistance to develop their plans.
“We hope to help those already providing housing solutions and those who may be able to help,” said committee chair John Nicholas.
© 2020 Global News, a division of Corus Entertainment Inc.
Kate Middleton and Prince William host glamorous reception for UK-Africa Investment Summit
William a speech at the event in which he spoke about the important relationship between the UK and Africa.
“The African continent holds a very special place in my heart,” the Duke of Cambridge said in a speech after arriving in the Music Room for the event. “It is the place my father took my brother and me shortly after our mother died.
“And when deciding where best to propose to Catherine I could think of no more fitting place than Kenya to get down on one knee.
“Throughout my life, I have been lucky enough to spend time in many other parts of Africa. I’m also honoured to be the Patron of the Royal African Society.
“And as Catherine and I have said to several of you here tonight, we hope to have the chance to visit many more countries in the future and share our mutual love of your continent with our children.”
Photo: © Yui Mok/AFP via Getty Images
Supporting employees and families in crisis is a good investment – Campbell River Mirror
Coping with stressful situations can be difficult at the best of times.
Supporting coworkers who are trying to process the loss of a loved one, marital separation, addiction issues or other life circumstances can also be challenging. While one’s co-workers, managers – even business owners – may be supportive and well-intentioned, they may not be equipped to adequately help someone through a difficult time or crisis.
It’s an issue more companies are addressing as a way to invest in their employees’ health and well-being, says Kelsi Baine, executive director and certified counsellor with Upper Island Counselling in Campbell River. Having a professional outside agency on standby to help employees and their families manage difficult times can be a good short- and long-term strategy, she adds.
Putting the ‘human’ into HR
If you oversee human resources for your company, no matter what its size, knowing how to respond when a staff member needs personal help can be tricky. Baine says many of her member companies learned about UIC’s Employee and Family Assistance Program through conversations and referrals from other HR professionals.
“For those in HR, when someone is struggling in their office, they want to support them, but they recognize they’re not a counsellor,” Baine says. “So they want to have a trusted and effective resource they can suggest as a way to best help them. Sometimes we’ve heard that one HR director will tell another, ‘if you don’t have this resource in your back pocket, you’re missing out.’”
Getting people the help they need
Brian Cruise, of Cruise HR Solutions, works with employers on ways to better support their staff. He agrees managers often struggle to help employees deal with personal issues that may be affecting their work.
“Those of us in the HR world, we’re not trained counsellors, so you often hesitate to involve yourself with employees because it’s unfamiliar turf,” he says. Not only that, he adds, employees can be reluctant to divulge personal struggles fearing that doing so may reflect badly on their work performance. “People are much more likely to talk openly and honestly with someone not connected with their workplace.”
Healthy workers mean healthy companies
With company owners or upper management focusing on running the business, it’s often operational staff who initiate discussions about the need for outside resources, Baine says.
“Frontline workers know when something is going on in someone’s life that requires taking time off or the availability of counselling supports,” she says. “When requests for more supportive services come from the ground up, many employers are receptive – they see it as a wise investment in their people, and we couldn’t agree more.”
If you’d like to find out how Upper Island Counselling can help you, your family and the people you work with, visit uics.ca or call 250-287-2266.
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