TORONTO, Jan. 13, 2016 /CNW/ - PowerShares Canada announced today that it will increase the net asset value (NAV) of three TSX-listed PowerShares exchange-traded funds (the "ETFs"), calculated after close of business on January 14, 2016.
PowerShares Fundamental High Yield Corporate Bond (CAD Hedged) Index ETF (PFH) and PowerShares Senior Loan (CAD Hedged) Index ETF (BKL) invest in one or more U.S. Regulated Investment Companies (RICs) that earn and distribute qualified interest-related dividends. PowerShares Tactical Bond ETF (PTB) is invested in PFH, and as a result, will also experience an increase in its NAV.
The NAV increases are a result of the Protecting Americans from Tax Hikes Act of 2015 (the "PATH Act"), which extends, on both a permanent and retroactive basis, favourable U.S. withholding tax treatment to foreign shareholders, including ETFs that receive RIC dividends comprised of short-term capital gains and/or qualified interest, so that those shareholders receive the same treatment with respect to such items as if they had invested directly in the RICs' underlying assets.
Recognizing the value this exemption provides investors, PowerShares Canada will reclaim that portion of the taxes withheld in 2015. Also, going forward, it is expected that the changes introduced by the PATH Act should allow the ETFs to obtain benefits of the exemption from U.S. withholding tax on RIC dividends through reduced withholding tax at source, rather than having to seek tax reclaims.
The NAV and NAV per unit of each of the ETFs, calculated after the close of business on January 14, 2016, will increase to reflect their respective tax reclaim receivable amounts.
The impact to NAV will be as follows:
| Fund name |
Fund ticker |
NAVPS impact |
| PowerShares Fundamental High Yield Corporate Bond (CAD Hedged) Index ETF |
PFH |
0.18044 |
| PowerShares Senior Loan (CAD Hedged) Index ETF |
BKL |
0.16722 |
| PowerShares Tactical Bond ETF |
PTB |
0.01088 |
To learn more about PowerShares ETFs, please visit www.powershares.ca.
For more information, please visit www.invesco.ca. You can also connect with Invesco Canada on Twitter (@InvescoCanada), LinkedIn or Facebook.
About Invesco Canada Ltd.
Invesco Canada Ltd., operating under three distinct yet complementary product brands (Trimark, Invesco and PowerShares), is one of Canada's leading investment management companies. A subsidiary of Invesco Ltd., Invesco Canada's singular focus is on investment management, offering a diversified suite of solutions to institutions, organizations, companies and individual investors across Canada and around the world. Additional information is available at www.invesco.ca.
About Invesco Ltd.
Invesco Ltd. is a leading independent global investment management firm, dedicated to helping investors worldwide achieve their financial objectives. By delivering the combined power of our distinctive investment management capabilities, Invesco provides a wide range of investment strategies and vehicles to our clients around the world. Operating in more than 20 countries, the firm is listed on the New York Stock Exchange under the symbol IVZ. Additional information is available at www.invesco.com.
Commissions, management fees and expenses may all be associated with investments in exchange-traded funds (ETFs). ETFs are not guaranteed, their values change frequently and past performance may not be repeated. Please read the prospectus before investing. Copies are available from Invesco Canada Ltd. at www.powershares.ca.
There are risks involved with investing in ETFs. Please read the prospectus for a complete description of risks relevant to the ETF. Ordinary brokerage commissions apply to purchases and sales of ETF units.
Most PowerShares ETFs seek to replicate, before fees and expenses, the performance of the applicable index, and are not actively managed. This means that the sub-advisor will not attempt to take defensive positions in declining markets and the ETF will continue to provide exposure to each of the securities in the index regardless of whether the financial condition of one or more issuers of securities in the index deteriorates. In contrast, if a PowerShares ETF is actively managed, then the sub-advisor has discretion to adjust that PowerShares ETF's holdings in accordance with the ETF's investment objectives and strategies.
ETFs are not diversified investments.
Investors should be aware of the risks associated with data sources and quantitative processes used in our investment management process. Errors may exist in data acquired from third-party vendors, the construction of model portfolios, and in coding related to the index and portfolio construction process. While Research Affiliates takes steps to identify data and process errors so as to minimize the potential impact of such errors on index and portfolio performance, we cannot guarantee that such errors will not occur.
"Fundamental Index®" and/or "Research Affiliates Fundamental Index®" and/or "RAFI®" and/or all other RA trademarks, trade names, patented and patent-pending concepts are the exclusive property of Research Affiliates, LLC.
S&P® is a registered trademark of Standard & Poor's Financial Services LLC and has been licensed for use by S&P Dow Jones Indices LLC and sublicensed for certain purposes by Invesco Canada Ltd. LSTA® is a registered trademark of Loan Syndications and Trading Association and has been licensed for use by S&P Dow Jones Indices LLC and Invesco Canada Ltd. The S&P/LSTA U.S. Leverage Loan 100 Index (CAD Hedged) is a product of S&P Dow Jones Indices LLC, and has been licensed for use by Invesco Canada Ltd. Invesco Canada Ltd.'s PowerShares Senior Loan (CAD Hedged) Index ETF is not sponsored, endorsed, sold or promoted by S&P Dow Jones Indices LLC or its affiliates or LSTA and none of S&P Dow Jones Indices LLC or its affiliates or LSTA make any representation regarding the advisability of investing in such product.
PowerShares Canada is a registered business name of Invesco Canada Ltd.
Invesco® and all associated trademarks are trademarks of Invesco Holding Company Limited, used under licence. PowerShares®, Leading the Intelligent ETF Revolution® and all associated trademarks are trademarks of Invesco PowerShares Capital Management LLC (Invesco PowerShares), used under licence.
© Invesco Canada Ltd., 2016
SOURCE PowerShares Canada
Aysha Mawani, Vice President, Corporate Affairs, Tel: 416.324.7712, [email protected]
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