First Asset launches actively managed Canadian REIT and dividend ETFs

Sep 13th, 2014 | By | Category: Alternatives / Multi-Asset

First Asset, a Toronto-based investment manager, has announced the launch of two new active exchange-traded funds: the First Asset Active Canadian REIT ETF (FRF) and the First Asset Active Canadian Dividend ETF (FDV).

First Asset launches actively managed Canadian REIT and dividend ETFs

First Asset has launched two new actively managed ETFs on the Toronto Stock Exchange providing exposure to Canadian REITs and dividend-paying stocks.

The ETFs, which have been listed on the Toronto Stock Exchange, provide actively managed exposure to real estate equities and dividend-paying stocks, respectively, listed in Canada.

Lee Goldman, an experienced real estate portfolio manager, heads up the First Asset Active Canadian REIT ETF, while Manash Goswami, recognized by Brendan Wood International as one of Canada’s top ranked portfolio managers in 2013, manages the First Asset Active Canadian Dividend ETF.

The REIT ETF seeks to build a portfolio of Canadian real estate investment trusts and real estate operating corporations that offer attractive yields, backed by predictable, recurring cash flow and are well-positioned for capital appreciation. It has a management fee of 0.65%.

According to Goldman, “Canadian property fundamentals have remained very solid over the last few years across most real estate asset classes, with high occupancy rates and generally rising rents. This should lead to healthy cash flow growth, which combined with well supported distribution yields in the 5-6% range, provides a very good return profile for the sector. Government bond yields have drifted lower this year, providing additional support for valuations and lower borrowing costs for the REITs.”

The dividend ETF takes a fundamental approach to investing, with emphasis on companies with sustainable, strong free cash flow, opportunity for dividend growth and poised for capital appreciation. It has a management fee of 0.55%.

According to Goswami, “Dividends have been a key component of overall total return throughout the years and will continue to be important as investors seek alternatives to other income products such as government bonds, which are at historically low yields. First Asset targets companies with strong free cash flow generation and the ability to sustain and grow dividends.”

The ETFs are denominated in Canadian dollars.

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