Claymore Investments, Inc. Thursday announced the launch of the Claymore Advantaged Canadian Bond ETF (TSX:CAB).

The new exchange traded fund seeks to provide a low cost, tax-efficient exposure to a diversified Canadian bond portfolio.

The return of the fund is based on the price and performance of the DEX DLUX Capped Bond Index net of fees and expenses. The index is designed to track Canadian investment grade Ggovernment and corporate bonds, with target exposure allocations of 60% and 40%, respectively. The fund will receive exposure to the bond securities underlying the index through the use of a forward agreement with TD Global Finance, Claymore says.

“Bonds are a very important part of an investment portfolio for income and diversification purposes and CAB is a simple, low cost way to get exposure to bonds on a tax-efficient basis,” explains Som Seif, president and CEO of Claymore.

“The fund is structured to provide tax-efficient income, making it an optimal investment for non-registered or taxable accounts and we are excited to be partnering with DEX, the leader in Canadian fixed income indexes, to bring this product to the market.”

IE