With approval on BetaPro Gold Bullion -2x Daily Bear ETF,
unitholder approval for all ETFs that are part of the corporate
class reorganization is now complete
TORONTO, Nov. 13, 2019 /CNW/ - Horizons ETFs
Management (Canada) Inc.
("Horizons ETFs") announced today that at a special meeting
of the unitholders of the BetaPro Gold Bullion -2x Daily Bear ETF
("HBD") held on November 13,
2019, unitholders approved all matters relating to the
merger of HBD, currently structured as a trust, into a
corresponding class of shares of a new multi-class corporate fund
structure to be managed by Horizons ETFs, as further described in
the Management Information Circular dated October 4, 2019, previously mailed to
unitholders.
HBD was the final ETF to receive approval from unitholders for
reorganization into the multi-class corporate fund structure. On
November 12, 2019, Horizons ETFs
announced that it had received unitholder approval on the Mergers
(the "Mergers") of 43 other ETFs (the "ETFs") that
were proposed for reorganization, as set out in Horizons ETFs'
press release dated August 23,
2019.
The necessary regulatory and Independent Review Committee
approvals have also been received.
Accordingly, Horizons ETFs expects to proceed with HBD's merger
on November 27, 2019. The other ETFs
are also expected to proceed with their Mergers on November 27 and November
29, as previously indicated. HBD will continue to trade as
normal up until its merger, and will continue trading on the
trading day following the Merger under the same ticker.
It is important to note that HBD is not expected to carry
forward any tax liability into the proposed multi-class corporate
fund structure, and no historical or retroactive taxable
implications to unitholders of HBD are expected.
The reorganization is not expected to be a taxable event for
unitholders of HBD provided that, in the case of Canadian resident
unitholders who hold units of HBD in taxable accounts, such
unitholders make a joint election with the proposed multi-class
corporate fund structure under Section 85 of the Income Tax
Act (Canada) as part of
the exchange from their existing trust units into shares of a class
of the new corporate fund structure. Horizons ETFs is establishing
a process to provide assistance to unitholders in taking the
necessary steps to file the joint election, which will be free of
charge. Additional information can be found here:
https://www.horizonsetfs.com/section-85-election.
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 $10 billion of
assets under management and 91 ETFs listed on major Canadian stock
exchanges.
Commissions, management fees and expenses all may be
associated with an investment in exchange traded products (the
"Horizons Exchange Traded Products") managed by Horizons ETFs
Management (Canada) Inc. The
Horizons Exchange Traded Products are not guaranteed, their values
change frequently and past performance may not be repeated. The
prospectus contains important detailed information about the
Horizons Exchange Traded Products. Please read the relevant
prospectus before investing.
The Horizons Exchange Traded Products include our BetaPro
products (the "BetaPro Products"). The BetaPro Products are
alternative mutual funds within the meaning of National Instrument
81-102 Investment Funds, and are permitted to use strategies
generally prohibited by conventional mutual funds: the ability to
invest more than 10% of their net asset value in securities of a
single issuer, to employ leverage, and engage in short selling to a
greater extent than is permitted in conventional mutual funds.
While these strategies will only be used in accordance with the
investment objectives and strategies of the BetaPro Products,
during certain market conditions they may accelerate the risk that
an investment in units of a BetaPro Product decreases in value. The
BetaPro Products consist of our 2x Daily Bull and 2x Daily Bear
ETFs ("2x Daily ETFs"), Inverse ETFs ("Inverse ETFs") and our
BetaPro S&P 500 VIX Short-Term Futures™ ETF (the "VIX ETF").
Included in the 2x Daily ETFs and the Inverse ETFs are the BetaPro
Marijuana Companies 2x Daily Bull ETF ("HMJU") and BetaPro
Marijuana Companies Inverse ETF ("HMJI"), which track the North
American MOC Marijuana Index (NTR) and North American MOC Marijuana
Index (TR), respectively. The 2x Daily ETFs and certain other
BetaPro Products use leveraged investment techniques that can
magnify gains and losses and may result in greater volatility of
returns. These BetaPro Products are subject to leverage risk and
may be subject to aggressive investment risk and price volatility
risk, among other risks, which are described in their respective
prospectuses. Each 2x Daily ETF seeks a return, before fees and
expenses, that is either 200% or –200% of the performance of a
specified underlying index, commodity futures index or benchmark
(the "Target") for a single day. Each Inverse ETF seeks a return
that is –100% of the performance of its Target. Due to the
compounding of daily returns a 2x Daily ETF's or Inverse ETF's
returns over periods other than one day will likely differ in
amount and, particularly in the case of the 2x Daily ETFs, possibly
direction from the performance of their respective Target(s) for
the same period. Hedging costs charged to BetaPro Products reduce
the value of the forward price payable to that ETF. Due to the high
cost of borrowing the securities of marijuana companies in
particular, the hedging costs charged to HMJI are expected to be
material and are expected to materially reduce the returns of HMJI
to unitholders and materially impair the ability of HMJI to meet
its investment objectives. Currently, the manager expects the
hedging costs to be charged to HMJI and borne by unitholders will
be between 15.00% and 35.00% per annum of the aggregate notional
exposure of HMJI's forward documents. The hedging costs may
increase above this range. The manager will publish, on its
website, the updated monthly fixed hedging cost for HMJI for the
upcoming month as negotiated with the counterparty to the forward
documents, based on the then current market conditions. The VIX
ETF, which is a 1x ETF, as described in the prospectus, is a
speculative investment tool that is not a conventional investment.
The VIX ETF's Target is highly volatile. As a result, the VIX ETF
is not intended as a stand-alone long-term investment.
Historically, the VIX ETF's Target has tended to revert to a
historical mean. As a result, the performance of the VIX ETF's
Target is expected to be negative over the longer term and neither
the VIX ETF nor its target is expected to have positive long-term
performance. Investors should monitor their holdings in BetaPro
Products and their performance at least as frequently as daily to
ensure such investment(s) remain consistent with their investment
strategies.
SOURCE Horizons ETFs Management (Canada) Inc.