Exchange-traded Funds  

BMO adds emerging markets to income ETF range

BMO adds emerging markets to income ETF range

BMO Global Asset Management has added an emerging markets option to its Income Leaders range of exchange traded funds (ETFs).

The BMO MSCI Emerging Markets Income Leaders Ucits ETF becomes the firm's sixth equity offering and the 10th overall, after it entered the space with nine strategies in late 2015.

The emerging market income option adds to similar equity strategies focused on the UK, US and Europe. It will be managed by BMO’s London-based team and has an ongoing charges fee of 0.38 per cent.

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BMO's Income Leaders ETFs tilt towards 'quality companies' with stable earnings based on low leverage, in a model developed with index provider MSCI.

The firm's director of ETFs Europe Marc Knowles said a strategy focused on such companies could help reduce volatility in emerging markets given the equities' sensitivity towards the dollar.

“A company’s stable earnings stream is a good indicator that they are better suited to cope with market shocks. Our Emerging Markets Income Leader ETF is constructed to help investors meet these challenges,” Mr Knowles added.

BMO’s head of UK intermediary Rob Thorpe said: “As the low yield, low interest rate environment continues, investors’ focus on yield coupled with their concerns around volatility are only intensifying."