ETF asset growth leads to cost reduction for clients

Stock market and currency movements mean the value of investments and the income from them can go down as well as up and you may not get back the amount originally invested. Investing in ETFs involves risk, including risks associated with market volatility, currency rate fluctuations, replication strategies, and changes in composition of the underlying index and assets.

 

We have reduced the fees on a number of ETFs in the Income Leaders and global corporate bond fund ranges, as economies of scale leads to cost savings for clients with assets under management in its ETF business increasing to £30 billion[1]. The reduced fees came into effect on 1 September 2018.

The Ongoing Charges Figures (OCFs) for the BMO Income Leaders suite of UK, Europe and US funds have been reduced from between 35 – 40 basis points to 25 – 30 basis points. The Income Leaders range provides multiple building blocks to help investors achieve income generation across different equity regions. The funds are designed to combine two factors; quality and yield, with investors benefitting from sustainable income and capital growth opportunities in a risk-controlled framework.

The OCFs of the BMO Barclays Global Corporate Bond range have been reduced from 30 basis points to 17 basis points, a 43% cost reduction. The range provides exposure to a suite of innovative investment grade global corporate bond ETFs, offering a spectrum of maturity bands which allow investors to precisely position their portfolios on the yield curve.

Kevin Gopaul, Head, Quantitative Strategies & ETFs at BMO Global Asset Management said: “From a market leading position in Canada, we extended our range of innovative solution-focused ETFs to the UK with the launch of our Global Corporate Bond ETFs and our Income Leader ETFs in November 2015.

“As our ETF business has continued to grow globally, we have been able to build economies of scale, which means we are now in a position to pass even further cost savings onto our clients.”

Rob Thorpe, Managing Director, Head of Distribution, Intermediary, UK at BMO Global Asset Management said: “We are always listening to clients and are acutely aware that cost is a real focus for many. As such, through offering our innovative ETFs at this reduced rate, we are able to offer even better value for money in the ETF space.”

 

[1] As at 31 July 2018 – CAD $50 billion.


Further information:

BMO Enhanced Income Equity ETFs Strategy Brochure 
BMO Income Leaders ETFs Strategy Brochure 
BMO Fixed Income ETFs Strategy Brochure 

Visit our webiste