Exchange Traded Funds (ETFs) continue to capture an increasingly large share of the investment marketplace in Canada. In 2012, the Canadian industry saw the largest ever annual inflows of $12 billion – a banner year for ETFs in Canada.
In its simplest form, an ETF is a security that trades like a conventional stock on an equity exchange. With almost 300 listings on Toronto Stock Exchange (TSX), there is a wide range of ETFs listed in the Canadian marketplace.
Many ETFs track the performance of an underlying index or benchmark. They may track the broad Canadian market, for example, or another geographic region. Some ETFs seek to replicate the performance of specific sectors, such as infrastructure or healthcare, while others track particular commodities such as gold, oil or natural gas. ETFs listed on TSX also track indices that offer exposure to the fixed income asset class.
In recent years, some ETFs have evolved beyond passively tracking an underlying index or benchmark. There has been an increasing focus on actively managed ETFs, both globally and in the Canadian marketplace. Actively managed ETFs in Canada are becoming more popular as investors continue to seek ways to build in more flexibility and diversity in their investment portfolios, for example, through alternative strategies, preferred shares or senior loans.
Get to Know Exchange Traded
Products Listed on TSX
To help investors better understand the investment choices available to them, TSX has developed a new, comprehensive online centre for Exchange Traded Products (ETPs)* at tmx.com/etf.
Among the many features are detailed ETF quotes, educational information, new ETF listings, a full directory of ETFs listed on TSX, and a Library section offering articles, news, videos, events and publications.
* ETPs include Exchange Traded Funds (ETFs) and Exchange Traded notes (ETns)