Middlefield Group is pleased to announce the launch of a platform of Exchange-Traded Funds (“ETFs”) that will provide investors with professional active management within a cost-effective, investor-friendly structure.
CALGARY, Oct. 16, 2018 /CNW/ - Middlefield Group is pleased to announce the launch of a platform of Exchange-Traded Funds (“ETFs”) that will provide investors with professional active management within a cost-effective, investor-friendly structure. The platform will include unique thematic investment strategies that are underrepresented in Canadian portfolios or difficult for investors to gain exposure to when using existing passive investment strategies. The platform will be established initially by converting two successful closed-end funds managed by Middlefield, Middlefield Healthcare & Life Sciences Dividend Fund and REIT INDEXPLUS Income Fund, which together represent approximately $150 million in assets.
Initial Funds to Convert to ETFs
Middlefield Healthcare & Life Sciences Dividend Fund (TSX:LS.UN) will become Canada’s first actively managed diversified healthcare ETF. It invests in the securities of global healthcare and life science issuers. Dean Orrico, Middlefield’s President and Chief Investment Officer, is the lead portfolio manager of the fund and Dr. Richard Evans of SSR LLC acts as industry advisor to Middlefield. Investment in the healthcare sector is underrepresented in Canada as compared to other sectors, making up just 2% of the S&P/TSX Composite Index. The Fund pays a monthly distribution and has outperformed both the S&P/TSX Composite Index and its benchmark since inception as shown in the table below.
Inception
Date
1-Year
Since Inception
Middlefield Healthcare & Life Sciences Dividend Fund
July 21, 2017
19.8%
19.4%
S&P/TSX Composite Index
5.9%
7.6%
MSCI Daily TR World Net Health Care USD Index
14.2%
12.4%
Annualized total returns including reinvestment of distributions and net of fees as at September 30, 2018.
Source: Bloomberg and Middlefield.
REIT INDEXPLUS Income Fund (TSX:IDR.UN) provides investors with low-cost exposure to the real estate sector through a combination of indexing and active portfolio management. Mr. Orrico is also the lead portfolio manager of REIT Indexplus and maintains that “REITs are amongst the most attractive equity income vehicles available to investors providing compelling risk-adjusted returns during both up and down markets”.
Inception
Date
1-Year
3-Year
5-Year
Since Inception
REIT INDEXPLUS Income Fund
April 20, 2011
14.5%
9.1%
10.7%
9.1%
S&P/TSX Composite Index
5.9%
9.7%
7.8%
5.2%
S&P/TSX Capped REIT Index
16.2%
11.0%
9.0%
8.2%
Annualized total returns including reinvestment of distributions and net of fees as at September 30, 2018.
Source: Bloomberg and Middlefield.
Special meetings of the funds will be held on December 10, 2018 at which unitholders of each fund as of November 7, 2018 will be asked to approve its conversion into an ETF. Further details of the meetings and the proposals of Middlefield Limited, manager of the Funds (the “Manager”) will be provided in a joint information circular to unitholders.
If approved, the Manager anticipates implementing the two conversions by early 2019. All costs of the conversions, including the cost of the meetings, will be borne by the Manager. Each of the funds will continue to be managed in the same fashion by Middlefield’s experienced portfolio management team. The conversions to ETFs will not be taxable events for unitholders of the funds. Each of the funds will continue to trade on the TSX under its current ticker symbol until conversion.
About Middlefield Group
Middlefield was established in 1979 and has approximately $4 billion in assets under management. Middlefield is a Specialty Investment Manager which creates investment products designed to balance risk and return to meet the demanding requirements of Financial Advisors and their clients. These financial products include Mutual Funds, Private and Public Resource Funds, Venture Capital Assets, TSX Publicly Traded Funds and Real Estate Investment Funds and Partnerships.
About SSR LLC
SSR LLC is an investment research boutique based in Stamford, Connecticut co-founded by Dr. Richard Evans. Leading the Healthcare division of SSR, Dr. Evans has over 20 years of industry experience. He was twice ranked first among his peers for drug stock selection by Bloomberg Markets. In 2006 he was ranked among the top 20 stock pickers worldwide by Bloomberg Markets. Dr. Evans provides analysis to Middlefield on behalf of SSR with respect to the healthcare sector.
Certain statements in this press release may be viewed as forward-looking statements. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, intentions, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects”, “is expected”, “anticipates”, “plans”, “estimates” or “intends” (or negative or grammatical variations thereof), or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements. There are no assurances the funds can fulfill such forward-looking statements and the funds do not undertake any obligation to update such statements. Such forward-looking statements are only predictions; actual events or results may differ materially as a result of risks facing one or more of the funds, many of which are beyond the control of the funds, including that the conversions are not approved at the meetings, that the conversions are not implemented on the expected timing or at all and that the funds will continue to be managed in the same fashion following the conversions.
You will usually pay brokerage fees to your dealer if you purchase or sell units/shares of investment funds on the Toronto Stock Exchange or other alternative Canadian trading system (an “Exchange”). If the units/shares are purchased or sold on an Exchange, investors may pay more than the current net asset value when buying and may receive less than the current net asset value when selling them.
There are ongoing fees and expenses associated with owning units or shares of an investment fund. An investment fund must prepare disclosure documents that contain key information about the fund. You can find more detailed information about the fund in these documents. The indicated rates of return are the historical annual compounded total returns, including changes in unit or share value, and does not take into account certain fees such as redemption fees or optional charges or income taxes payable by any securityholder that would have reduced returns. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated.
SOURCE Middlefield Healthcare & Life Sciences Dividend Fund
Company Codes: Toronto:IDR.UN