TORONTO – April 30, 2021 – Horizons ETFs Management (Canada) Inc. (“Horizons ETFs”) announces certain modifications to the methodology of the Solactive Canadian Select Universe Bond Index (“SOLHBB” or the “Index”), which is the underlying index for the Horizons Cdn Select Universe Bond ETF (“HBB” or the “ETF”). The Index methodology was modified to further optimize its exposure to the Canadian bond market.
SOLHBB is administered by Solactive AG to measure the performance of the investment grade Canadian bond market denominated in Canadian Dollars (“CAD”). HBB seeks to replicate, to the extent possible, the performance of the Solactive Canadian Select Universe Bond Index, net of expense. Both the objective of the Index and the ETF remain unchanged.
A summary of the changes to SOLHBB’s methodology is as follows:
- The Index will now be calculated based upon Last Evaluated Mid Price, instead of Last Evaluated Ask Price of the Index components;
- Clarification that the Index is composed only of bonds where the country of issuance is Canada, the, country of issuing entity is Canada, and the denomination is in CAD;
- An increase of the Minimum Amount Outstanding for government bonds to CAD $100 million; • An addition of DBRS to the ratings agency list;
- Simplification of the capping and bucketing of issues, reducing to the top 85% of corporate bonds (by Market Value) to be included in the Index;
- Simplification of the capping and bucketing of issues, reducing to the top 99% of government bonds (by Market Value) to be included in the Index;
- Specification that the weighting of the Index components will now be based upon their respective Market Values; and • Clarification that bonds components (Government or Corporate) are only removed from the index if they no longer meet the minimum rating criteria (>BBB-), or no longer meet the Index inclusion requirements.
The Index changes are effective at the close of business April 30th. HBB will reflect these changes simultaneously. HBB’s name, ticker and management fee remain the same.
A complete copy of the updated Index methodology for SOLHBB, including the defined terms noted above, can be found at www.HorizonsETFs.com or www.Solactive.com.
About Horizons ETFs Management (Canada) Inc. (www.HorizonsETFs.com)
Horizons ETFs Management (Canada) Inc. is an innovative financial services company and offers one of the largest suites of exchange traded funds in Canada. The Horizons ETFs product family includes a broadly diversified range of solutions for investors of all experience levels to meet their investment objectives in a variety of market conditions. Horizons ETFs has approximately $18 billion of assets under management and 92 ETFs listed on major Canadian stock exchanges.
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Contact Jonathan McGuire
Assistant Vice President, Corporate Communications
Horizons ETFs Management (Canada) Inc.
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