Toronto-based Claymore Investments Inc. has launched Clay-more Gold Bullion exchange-traded fund, which invests in holdings of gold bullion, in 400 or 100 troy ounce international bar sizes, and does not speculate with regard to short-term changes in gold prices. Put and call options are now available for greater investment and trading strategies for the fund. The investment objective is to replicate the performance of the price of gold bullion, minus the fund’s expenses and fees, and to provide investors with the ability to obtain exposure to gold bullion in a convenient, tradable and secure manner without the associated inconvenience and high transaction, handling, storage, insurance and other costs typical of direct gold bullion investment, says Claymore. Given that gold bullion is priced in U.S. dollars, the fund currently offers a hedged common unit through which the fund hedges substantially all of the fund’s US$ currency value of these units back to the Canadian dollar, providing exposure to gold while reducing the currency risk for Canadian investors. The fund does not anticipate making regular distributions on its units. Options are also currently available on Claymore Natural Gas Commodity ETF and Claymore Global Agriculture ETF.

Arrow Hedge Partners closes high-yield fund

Toronto-based Arrow Hedge Partners Inc. says that Arrow High Yield Fund is scheduled to close to new investment on June 30. The proposed closing is intended to cap the fund at the target asset level of $500 million. The fund is designed to appeal to accredited investors who are moderately conservative and seek monthly income with low volatility. The investment objective is to achieve a high level of income with the potential for capital gains while maintaining modest volatility. The fund invests primarily in Canadian high-yield corporate bond issuers and is able to create long positions in the debt of a company and a short position in the equity of a company. Over the long term, the fund has outperformed the market but, at the same time, took a lot less risk and produced far less volatile returns, says Arrow. The firm has determined that it would be in the best interest of investors to cap the fund at the target of $500 million. Arrow says the target cap is much larger than any other retail credit hedge funds in Canada, and that the strategy itself is not being closed.

New ETFs from Horizons AlphaPro

Toronto-based AlphaPro Management Inc. has listed three new actively managed exchange-traded funds on the Toronto Stock Exchange: Horizons AlphaPro Dividend ETF, Horizons AlphaPro North American Value ETF and Horizons AlphaPro North American Growth ETF. Horizons AlphaPro Dividend ETF will seek long-term total returns consisting of regular dividend income and modest long-term capital growth. This ETF invests primarily in equities of major North American companies with above-average dividend yields and is subadvised by Toronto-based Leon Frazer & Associates Inc. Lyle Stein, CEO of Leon Frazer, will oversee the portfolio selection for the ETF. Horizons AlphaPro North American Value ETF will seek long-term capital appreciation and income by investing in equities and equities-related securities of issuers located in North America. Toronto-based subadvisor Vito Maida of Patient Capital Management Inc. will rely primarily on his “value” investment style to identify companies for this ETF portfolio. Horizons AlphaPro North American Growth ETF will seek long-term capital growth by investing primarily in equities and equities-related securities of issuers located in North America. Stephen Rogers, vice president and portfolio manager with Toronto-based JovInvestment Management Inc., the ETF’s investment manager, will apply a flexible “growth” investment style to identify portfolio investments.

New fund from First Asset Management

Toronto-based First Asset Management Inc. has filed a preliminary prospectus for an initial public offering for First Asset Canadian Dividend Opportunity Fund of trust units at $10 per unit. The fund will invest in an actively managed portfolio made up primarily of equities from Canadian utility, pipeline and telecommunications issuers. The fund’s managers will select higher-yielding securities from issuers that First Asset believes will benefit from the near-term economic environment in Canada and globally; the company believes that these sectors are significantly undervalued, offer attractive yields and/or rising payout ratios. The fund will provide investors with monthly distributions and the opportunity for capital appreciation. The distributions are initially targeted to be 6% per annum. The portfolio will be managed by First Asset, with John Stephenson in the role of lead portfolio manager. On or about the second anniversary of the offering, the fund will automatically convert to an open-ended mutual fund or merge with an open-ended mutual fund on a tax-deferred basis. First Asset has also launched two other closed-end funds, Canadian Convertible Debenture and Canadian Energy Convertible Debenture, that will transform or merge into mutual funds.

@page_break@Compiled by Clare O’Hara (cohara@investmentexecutive.com).