Harvest launches actively managed European equity ETF

Morningstar Canada 6 March, 2018 | 6:00PM

Harvest European Leaders Income (symbol: HEUR), an actively managed exchange-traded fund that will employ covered-call options on selected large-cap European stocks, opened for trading today on the Toronto Stock Exchange.

Managed internally by sponsor Harvest Portfolios Group Inc., the ETF's strategy is to invest in an equally weighted portfolio of 20 to 30 dividend-paying European equities. To reduce volatility and generate option-premium income, covered calls may be written on up to 33% of the portfolio securities. The extent of covered-call writing may vary, depending on management's assessment of market volatility and other factors.

Stock selection will be based on a combination of value, quality and growth criteria, and a minimum market capitalization. To be considered for inclusion in the portfolio, a stock must have a market cap of at least 10 billion euros at the time of investment.

The portfolio will be rebalanced at least quarterly, and will be diversified by country and by industry.

The management fee is 0.75%, not including operating expenses.

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