Toronto-based Manulife Investments, a division of Manulife Asset Management Ltd., announced on Wednesday that it will be launching a series of multifactor ETFs in April with Dimensional Fund Advisors Canada ULC (DFAC) as their subadvisor.
Specifically, Manulife Investments will introduce four multifactor equities ETF strategies focusing on multiple geographies, including Canadian large-cap, developed international, U.S. large-cap and U.S. mid-cap.
A preliminary prospectus containing important information relating to securities in the Manulife ETFs has been filed with securities commissions or similar authorities in each of Canada’s provinces and territories.
Manulife Investments had entered into an agreement with DFAC that provides Manulife Investments with exclusive access to DFAC’s subadvisory services with respect to Canadian ETFs for a period of seven years, subject to certain conditions.
Austin, Tex.-based Dimensional Fund Advisors LP (Dimensional), DFAC’s parent company, is a global investment manager with US$460 billion in assets under management as of Dec. 31, 2016.
The firm applies insights from academic research into a systematic investment process across asset classes and focuses on factors that have been shown to have the potential for higher expected returns. This is based in part on the research of Nobel Laureate Eugene Fama and researcher Kenneth French, both of whom serve on Dimensional’s board of directors.
The ETFs will seek to track indices that Dimensional has designed, which leverage their time-tested, factor-based approach.
“A key component of our strategy is to employ only the highest-quality managers for our investment platform, and that’s precisely what we have gained with our Dimensional partnership,” says Bernard Letendre, President, Manulife Investments, in a statement. “ETFs have become an essential component of investors’ portfolios, and now we can offer Canadians a best-in-class product managed by Dimensional’s bench strength.”
“Dimensional has applied advanced financial science to investment solutions for more than 35 years and our approach is rooted in decades of research into the factors that drive higher expected returns,” adds Eduardo Repetto, Co-CEO and Co-chief investment officer with Dimensional. “We are excited to work with Manulife to bring our investment approach to the Canadian ETF market.”
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