BMO Financial Group

BMO Financial Group
BMO Bank of Montreal

BMO Bank of Montreal

September 28, 2011 17:31 ET

BMO ETF Business Grows As Investors Seek Out Value and Innovation

- Low management fees range from 0.15% to 0.65%

- BMO offers 40 ETFs with exposure to commodities, equities and fixed income

- BMO's ETF business has grown to $3 billion in less than two and a half years

TORONTO, ONTARIO--(Marketwire - Sept. 28, 2011) - As the popularity of Exchange Traded Funds (ETFs) grow in Canada, BMO's portfolio of ETFs continues to offer a wide range of exposure to investors while also providing them with value and low management fees.

BMO's ETF business was launched in 2009 and, at the time, was the only bank affiliate to offer its own line-up of ETFs. Since then, BMO's ETF product line has grown to 40 funds and its assets under management (AUM) to more than $3 billion.

"The growth of our ETF business is a clear indicator that Canadian investors are seeking solid value from their investments," said Kevin Gopaul, VP & CIO, BMO Asset Management Inc. "Our ongoing commitment to evolving the ETF landscape, coupled with our desire to give investors innovative products, has resulted in a number of industry firsts and wide recognition."

ETFs and Their Advantages

In most cases, an ETF is an investment fund that is linked to a stock market index and seeks to replicate, to the extent possible, the performance of that particular index. An ETF can hold a variety of assets like stocks or bonds that match the index it is tracking. ETFs have numerous advantages to investors, including:

  • Lower costs – ETFs have relatively low management fees and expenses, making more of your money work for you over the long term.
  • Portfolio transparency – The current trading price of an ETF can be viewed at any time during a regular trading day, and all portfolio holdings are visible on a daily basis.
  • Investment flexibility – Investors can easily and efficiently gain exposure to a particular region, market, sector, commodity or theme. In addition, ETFs can be bought and sold at current market prices throughout the trading day.
  • Diversification – A single ETF will allow for instant diversification from investing in a portfolio of securities, which can help mitigate single stock risk.
  • Liquidity – Unlike most fund structures, ETFs enable investors to buy and sell whenever the markets are open.
  • Tax efficiencies – ETFs tend to have lower portfolio turnover and fewer realizations of capital gains and losses than other investment funds.

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