The ETF provider said that the Canada Preferred ETF will track the Solactive Canada Preferred Stock Index, which is designed to measure the performance of preferred stocks from Canadian issuers traded on the Toronto Stock Exchange.
According to the Global X Funds, the Underlying Index does not seek to directly reflect the performance of the companies issuing the preferred stock. It is comprised of preferred shares that meet certain criteria relating to size, liquidity, issuer rating, maturity and other requirements as determined by Structured Solutions.
As of May 16, 2011, the three largest components of the index were Transcanada Manulife Financial, and Canadian Imperial Bank.
Global X Funds CEO Bruno del Ama said that CNPF provides a relatively efficient way for investors to reap the benefits of this hybrid asset class as well as receive international exposure via the Canadian issuers traded on the Toronto Stock Exchange.
