An investment revolution: Phenomenal growth, incredible versatility

Starting out as a Canadian-made innovation, the world’s first ETF was launched in 1990, offering low-cost exposure to market index returns. Since then, ETFs have enjoyed explosive growth. Global assets have surged to more than US$9.37 trillion, with a 10-year compound annual growth rate of 21%. There are now more than 10,100 ETFs listed around the world. As ETFs continue to evolve, they are an increasingly important component of portfolio construction. They can provide investors and advisors with many benefits, including diversification, intraday liquidity and flexibility.

Features of ETFs

1. Diversification

By aiming to replicate a specific basket of securities, an ETF aims to incorporate all, or a representative sample of, the securities that make up that basket. Similar to a mutual fund, this may reduce the impact that volatile markets have on the portfolio, especially when compared to a portfolio of individual securities.

2. Liquidity

Liquidity is a function of the ETFs creation/redemption process. The actual creation and redemption of ETF units takes place on the primary market between the ETF and a designated broker. By continuously creating and redeeming units of an ETF, the broker meets the supply-and-demand needs of investors on the secondary markets where the ETF trades. This allows for the ability to trade ETFs at a price that closely approximates the market value of their underlying assets.

3. Flexibility

Similar to stocks, ETFs can be bought and sold throughout the trading day on a stock exchange at prices determined by the market. This allows investors to act on information quickly and efficiently

ETFs designed specifically for Canadians

In a competitive ETF environment, Mackenzie has always been committed to Canadians. We’ve been helping Canadian advisors deliver the best advice and investment solutions for over 50 years. Our well-made, well-managed and well-priced suite of more than 40 Canadian-domiciled  ETFs provide key advantages for Canadian investors when compared to US-domiciled ETFs.

Mackenzie Investments’ comprehensive suite of active, strategic beta and traditional index ETFs helps redefine investing by providing innovative and agile strategies for investors and advisors. Our cost-effective ETFs cover the full spectrum of investment types to meet the evolving needs of investors, helping Canadians build financial security

Active

These ETFs are managed by a portfolio manager and follow their active strategies. They can represent fixed income, equity, balanced and alternative mandates, as well as different geographical exposures. Mackenzie’s active ETFs are agile solutions that place asset management decisions in the hands of experienced portfolio managers. These ETFs are designed to seek better risk-adjusted returns, improve risk management and provide diversification. Access portfolio manager expertise with Mackenzie’s Actively Managed ETFs.

Strategic beta

Strategic beta defines a set of investment strategies that emphasize the use of alternative index construction rules, instead of traditional market capitalization based indices. They also emphasize capturing investment factors or market inefficiencies in a transparent and rules-based strategy. Mackenzie Maximum Diversification ETFs are based on underlying indexes provided by TOBAM, a Paris-based index provider. These equity ETFs were created to help protect the core of an investor’s portfolio from equity market biases and unmanaged risks. Discover the benefits of maximum diversification with Mackenzie’s Strategic Beta ETFs.

Traditional index

Also known as passive ETFs, these funds track an index, along with the rules that the index follows. Mackenzie’s traditional index ETFs provide pure market exposure to a range of asset classes as a complement to active and strategic beta strategies. Based on underlying indexes provided by Solactive and China Securities Index Co., Ltd., they can be used as building blocks for asset allocation, portfolio construction and investment planning. Expand your investment toolbox with Mackenzie’s Traditional Index ETFs.

How ETFs fit in a portfolio

1. Strategic asset allocation

Strategic asset allocation helps create an appropriate long-term risk/return profile. Whether looking to cover the broad global equity market, the total bond market, or take positions in specific countries, commodities or real estate, there’s likely an ETF to help meet investor objectives.

2. Portfolio completion

Whether it’s a missing asset class, sector, style, foreign market or commodity, the right ETF can help complete a portfolio by providing exposure to many companies within that asset category — in just one trade.

3. Core and satellite

The core-satellite approach to portfolio construction can be used to combine actively managed strategies with index ETFs in a single portfolio. This methodology can complement active investment management in seeking to establish a risk-controlled portfolio while also raising the potential for outperformance.

4. Tactical asset allocation

Making tactical asset allocation decisions is a form of active management designed to add alpha (returns above that of the market). Tactical investing is a process that can analyze current market conditions and then position portfolios accordingly to potentially help investors enhance returns and/or reduce portfolio risk. This methodology can complement active investment management in seeking to establish a risk-controlled portfolio while also raising the potential for outperformance. 

Why invest with Mackenzie

Being local matters. In fact, 61% Canadian investors say they prefer to purchase ETFs from Canadian providers^.3 We strongly believe that ETFs should be built with investors’ local investment and tax considerations in mind. As one of the largest Canadian-owned global asset managers, our commitment will always be to Canadian investors, with a Canadian-domiciled suite of ETFs engineered in Canada for Canadians. We also remain committed to providing advisors with product support, portfolio construction expertise, industry perspective and market making facilitation on complex trades. With over 100 years of combined ETF experience, Mackenzie’s dedicated team of Canadian experts is experienced in ETF product development, client support, portfolio management, operations and market making facilitation. Our ETF team delivers consistent education and insights to support the needs of Canadian advisors and investors. 

For more information about Mackenzie ETFs, please talk to your financial advisor. 

1 ETF Global Investing (ETFGI), August 15, 2022  

2 Bloomberg, July 31, 2022

3 Pollara Strategic Insights, February 2020

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All rights in the CSI 300 Index vest in CSI. “CSI 300®” is a trade mark of CSI. CSI does not make any warranties, express or implied, regarding the accuracy or completeness of any data related to the CSI 300 Index. CSI is not liable to any person for any error of the CSI 300 Index, nor shall it be under any obligation to advise any person of any error therein. Mackenzie China A-Shares CSI 300 Index ETF is in no way sponsored, endorsed, sold or promoted by CSI and CSI shall not have any liability with respect thereto.

The Mackenzie ETFs are not sponsored, promoted, sold or supported in any other manner by Solactive nor does Solactive offer any express or implicit guarantee or assurance either with regard to the results of using the Indices, trade marks and/or the price of an Index at any time or in any other respect. The Solactive Indices are calculated and published by Solactive. Solactive uses its best efforts to ensure that the Indices are calculated correctly. Irrespective of its obligations towards the Mackenzie ETFs, Solactive has no obligation to point out errors in the Indices to third parties including but not limited to investors and/or financial intermediaries of the Mackenzie ETFs. Neither publication of the Solactive Indices by Solactive nor the licensing of the Indices or related trade mark(s) for the purpose of use in connection with the Mackenzie ETFs constitutes a recommendation by Solactive to invest capital in said Mackenzie ETFs nor does it in any way represent an assurance or opinion of Solactive.