Invesco launches low-volatility U.S. equity ETF

By Staff | January 24, 2012 | Last updated on January 24, 2012
1 min read

Invesco Canada has announced the listing of Canada’s first and only low-volatility index-based ETF, PowerShares S&P 500 Low Volatility (CAD Hedged) Index ETF.

The ETF is designed to give investors exposure to the 100 stocks from the S&P 500 Index with the lowest realized volatility over the past 252 trading days, rebalanced on a quarterly basis. To provide this exposure, the ETF invests in units of U.S.-listed PowerShares S&P 500 Low Volatility Portfolio.

There is a spread of 10 basis points between the Canadian ETF (0.35%) and the U.S.-listed version (0.25%), which covers the cost of currency hedging.

“While investors have generally equated low volatility with low returns, many are realizing that strategies designed to reduce exposure to volatility can have a better risk-return profile relative to strategies that provide exposure to traditional indices,” said Michael Cooke, head of distribution for PowerShares Canada.

Advisor.ca staff

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.