Blackrock Canada is launching two iShares funds focusing on European exposure.
The iShares MSCI Europe IMI Index ETF seeks to track the MSCI Europe IMI while the iShares MSCI Europe IMI Index ETF (CAD-Hedged) seeks to track the MSCI Europe IMI 100% Hedged to CAD Index. Both indices capture large, mid and small-cap representation across the developed countries in Europe, and include 1,315 constituent equities (as of January 31, 2014). MSCI Europe IMI Index ETF’s index is hedged back to Canadian dollars.
The new funds’ management fees are 0.25% and were launched under the tickers TSX: XEU and TSX: XEH, respectively. XEU began trading on April 22nd and XEH is expected to begin trading on April 24th.
The MSCI Europe IMI’s current price-to-equity ratio (P/E) stands at 17.71, compared with a P/E of 19.9 for the MSCI USA IMI and 20.7 for the MSCI Canada IMI. Meanwhile, dividend yield for the MSCI Europe IMI stands at 3.09%, compared with 1.91% and 2.87% for the U.S. and Canada MSCI indexes, respectively.
The MSCI Europe IMI covers key economic sectors that are underweighted in Canadian indexes, including industrials (e.g. Siemens AG, Airbus Group N.V. and Rolls-Royce Holdings PLC), healthcare (e.g. Roche Holding AG, Novartis AG, GlaxoSmithKline PLC) and consumer discretionary (e.g. BMW AG, Daimler AG). The iShares funds track indexes that cover approximately 99% of free float-adjusted market capitalization across European developed-market countries, aiming to let investors explore growth outside North America, and mitigate cyclical and economic risk through geographic and sector diversification.