TORONTO, Jan. 9, 2023 /CNW/ - Horizons ETFs Management (Canada) Inc. ("Horizons ETFs" or the "Manager") is announcing the suspension of new subscriptions to the Horizons USD Cash Maximizer ETF ("HSUV.U" or the "ETF"), effective at the close of business today.
Launched on July 2, 2020, HSUV.U seeks to generate modest capital growth by investing primarily in high-interest U.S. dollar deposit accounts with Canadian banks. While any decision to pay dividends or other distributions is within the discretion of the Manager, HSUV.U has not made any distributions since its inception, nor is it currently expected to make any regular cash distributions. The value of any interest earned is reflected in the net asset value ("NAV") of the ETF.
The current assets under management ("AUM") of HSUV.U are approximately US$775 million, which is equivalent to more than $1 billion Canadian dollars. At this AUM threshold, it is the Manager's view that this suspension will help manage potential tax implications and ensure that HSUV.U can continue to reinvest its distributions, consistent with HSUV.U's current investment objectives.
As noted in HSUV.U's prospectus, if the ETF experiences a significant increase in total NAV, the Manager may, in its sole discretion and if determined to be in the best interests of shareholders, decide to suspend subscriptions for new ETF shares if considered necessary or desirable in order to manage potential tax implications and/or to permit HSUV.U to achieve, or continue to achieve, its investment objectives. It is the Manager's view that the suspension will help manage potential tax implications and ensure that HSUV.U can continue to reinvest distributions.
This suspension of subscriptions will not affect the ability of existing shareholders of HSUV.U to sell their shares in the secondary market at a price reflective of at least its NAV per share, assuming normal course market conditions. However, investors and potential investors should note that during a period of suspended subscriptions, the Manager expects shares of HSUV.U to trade at a premium to its NAV per share. While new subscriptions are suspended, Horizons ETFs is strongly discouraging investors from purchasing shares of HSUV.U.
Any subsequent resumption of subscriptions for HSUV.U will be announced by press release and posted on the Manager's website.
For more information about HSUV.U, please visit: www.HorizonsETFs.com/HSUV.U
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 more than $23 billion of assets under management and 107 ETFs listed on major Canadian stock exchanges.
Commissions, management fees and expenses all may be associated with an investment in the Horizons USD Cash Maximizer ("HSUV.U" and or the "ETF") managed by Horizons ETFs Management (Canada) Inc. The ETF is not guaranteed, its value changes frequently and past performance may not be repeated. The prospectus contains important detailed information about the ETF. Please read the prospectus before investing.
HSUV.U uses cash accounts and do not track a traditional benchmark but rather a compounding rate of interest paid on cash deposits that can change over time. HSUV.U primarily invests in bank deposit accounts and is not covered by the Canada Deposit Insurance Corporation, Federal Deposit Insurance Corporation, or any other government deposit insurer.
Any distributions which are received by HSUV.U are reflected automatically in its net asset value (NAV). As a result, the shareholders of HSUV.U are not expected to receive any taxable distributions.
Certain statements may constitute a forward-looking statement, including those identified by the expression "expect, "anticipate" and similar expressions (including grammatical variations thereof). The forward-looking statements are not historical facts but reflect the author's current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. These and other factors should be considered carefully and readers should not place undue reliance on such forward-looking statements. These forward-looking statements are made as of the date hereof and the authors do not undertake to update any forward-looking statement that is contained herein, whether as a result of new information, future events or otherwise, unless required by applicable law.
SOURCE Horizons ETFs Management (Canada) Inc.
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