Toronto financial company BMO Asset Management is launching three exchange-traded funds (ETFs) specializing in the direct holding of gold bars stored on Canadian soil.
According to BMO Asset Management, these new gold market ETFs “will allow investors to have direct exposure to the price of gold bullion without having to purchase and store the precious metal.”
Introduced on the Toronto Stock Exchange on Friday, these gold bullion ETFs are listed under three related symbols: ZGLD for the BMO Canadian Dollar Gold Bullion ETF, ZGLD.U for the BMO Canadian Dollar Gold Bullion ETF US dollars, and ZGLH for the BMO gold bullion ETF which is hedged to Canadian dollars
According to BMO Asset Management, these gold bullion ETFs with management fees advertised at 0.2% “were created in response to investor demand for exchange-traded funds that not only invest in gold, but also hold physical gold in a highly secure location in Canada.
BMO Asset Management is the leading investment fund subsidiary of Bank of Montreal with $97 billion in assets under management, representing 23% of the ETF market share in Canada.
With a good sense of appropriateness, BMO wishes to capitalize on the enthusiasm that global markets are experiencing for the precious yellow metal.
In the opinion of Alfred Lee, portfolio manager at BMO Asset Management, “in times of economic uncertainty, geopolitical concerns and stubbornly high inflation, gold is an attractive asset class for investors who are looking to diversify their investment portfolio.
With these new gold bullion ETFs, according to Alfred Lee, investors are offered “an accessible and profitable way to gain exposure to physical gold, but without the difficulties associated with purchasing and storing gold. precious metals “.
BMO Asset Management has also announced management fees limited to 0.2% for its three new gold bullion investment ETFs.
In their first trading session on the stock exchange on Friday, shares of the BMO Canadian Dollar Gold Bullion ETF (CGLD) gained 5% to around C$31.60, for an initial market capitalization of nearly 3 million dollars.
In comparison, the pioneer of gold bullion ETFs on the Canadian stock market, the iShares Gold Bulllion (CGL) fund managed by the American firm BlackRock Investment and the Toronto firm RBC Global Asset Management, has a market capitalization of 730 million.
And for the moment, the management fees for this iShares Gold Bullion ETF are still announced at 0.5%, more than double the fees announced for the new gold bullion ETFs from BMO Asset Management.
Combined, fund management firms RBC Global Asset and iShares/BlackRock are the largest provider of ETFs to the Canadian stock market, just ahead of BMO Asset Management
These two firms bring together $113 billion in assets under management, which represents almost 28% of the ETF market share in Canada according to the monthly statement carried out by National Bank Financial.