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The investment industry is always changing, and investors need to navigate an often-complex environment to minimize risks and maximize returns. They repeatedly encounter a host of factors that may influence the pursuit of these goals. These include changes in global markets and economies, geopolitics and technological advancements. By staying informed on emerging trends, investors can position themselves to capitalize on new opportunities and navigate the complexities of the evolving market. This is only half the battle. The other half is choosing the right investments for their needs and goals.
Investment sequels from TD Asset Management Inc.
Over the past few years TD Asset Management Inc. (TDAM) has listened carefully to what investors are saying and have successfully launched several new investment solutions to meet their needs. Fast forward to today and TDAM has launched three "sequels" to the TD Target Maturity Bond Exchange-Traded Funds, TD Cash Management ETF and TD Q U.S. Small-Mid-Cap Equity ETF.
Target Maturity Bond ETFs - Following the successful launch of the TD Target Maturity Bond ETFs in April 2024, TDAM has expanded its suite with new maturities in 2028, 2029 and 2030 (Canadian dollar versions only). These solutions are popular amongst investors for their simplicity, liquidity, and flexibility in incorporating bonds into portfolios for greater diversification and return potential. In times of uncertainty, bonds can help stabilize portfolios from the wild swings in equity markets that often catch many by surprise. Plus, most deliver a regular stream of income.
As the name suggests, the TD Target Maturity Bond ETFs purchase bonds that have a common maturity date (successive years from 2025 to 2030) and thus are like holding individual bonds. The income received is relatively stable because the ETFs typically don't need to replace holdings along the way and they invest in a portfolio of investment-grade corporate bonds which are hand-picked by TDAM's Fixed Income Investment Team, offering some stability to portfolios. Plus, they can be easily bought and sold on the exchange.
Cash Management ETFs – Earlier this year TDAM also launched the TD Cash Management ETF (TCSH), a solution designed to help you save for the short to medium term. A key benefit for investors is that because it's not a Money Market or High Interest Savings Account (HISA) ETF, it can have a slightly longer duration, and by extension, a higher yield through exposure to corporate bonds, yet with minimal interest rate risk. Now, TDAM is launching a U.S. dollar version, the TD U.S. Cash Management ETF (TUSD.U). For those investors with U.S. dollar accounts, TUSD.U aims to produce a high level of interest income by investing in high-quality debt securities generally maturing in less than one year.
Small-Mid-Cap Equity ETFs – Over the last year or so, the U.S. equity market has been led by only a handful of large-cap stocks, mostly in the Technology sector (the famously-named "Magnificent 7"). Many of these stocks have seen large price increases and hefty valuations, which now have many investors questioning how high is too high. Historically, U.S. small and mid-cap stocks have traded at a premium versus large-cap stocks, reflecting their higher risk/return profile. But that has changed.
Many small and mid-cap companies are now trading at a discount, a phenomenon we haven't seen in a very long time. For investors, this may mean that there is now a unique opportunity to add U.S. small and mid-cap stocks to the equity portion of a portfolio to capture their growth potential. Fortunately for investors, TD Q U.S. Small-Mid-Cap Equity ETF (TQSM), which was launched back in 2019, was created to provide investors with exposure to a diversified portfolio of small- and mid-cap U.S. companies. Now, for Canadian investors who have U.S. dollars to invest, TDAM has just launched a U.S. series, the TD U.S. Q U.S. Small-Mid-Cap Equity ETF (TQSM.U).
TD U.S. Q U.S. Small-Mid-Cap Equity ETF aims to provide investors with long-term capital growth by using an active, quantitative approach to security selection that exploits market inefficiencies related to the pricing and valuations of securities to add value.
Building on our strengths
It's not just about the proliferation of choice. Nowadays investors need a roadmap to be able to incorporate ETFs successfully into portfolios. As one of the largest institutional asset managers in Canada, TDAM has been offering index investments to pension plans, endowments, and foundations for decades—but we've also been offering index investments to Canadians since before ETFs were invented, since 1985 in fact.
With a legacy of experience in passive investing, we also offer ETFs that are sector focused, quantitative active solutions from one of the largest quantitative teams in Canada, and fundamental active solutions from our award-winning portfolio managers. As one of the fastest growing providers over the past few years, we have grown our ETF assets from $1B in 2020 to over $17B today.
For more information about TD ETFs and to view our entire line-up, visit us at td.com/etfs.
The information contained herein has been provided by TD Asset Management Inc. and is for information purposes only. The information has been drawn from sources believed to be reliable. The information does not provide financial, legal, tax or investment advice. Particular investment, tax, or trading strategies should be evaluated relative to each individual’s objectives and risk tolerance.
Commissions, management fees and expenses all may be associated with investments in exchange-traded funds (ETFs). Please read the prospectus and ETF Facts before investing. ETFs are not guaranteed, their values change frequently, and past performance may not be repeated. ETF units are bought and sold at market price on a stock exchange and brokerage commissions will reduce returns.
Certain statements in this document may contain forward-looking statements (“FLS”) that are predictive in nature and may include words such as “expects”, “anticipates”, “intends”, “believes”, “estimates” and similar forward-looking expressions or negative versions thereof. FLS are based on current expectations and projections about future general economic, political and relevant market factors, such as interest and foreign exchange rates, equity and capital markets, the general business environment, assuming no changes to tax or other laws or government regulation or catastrophic events. Expectations and projections about future events are inherently subject to risks and uncertainties, which may be unforeseeable. Such expectations and projections may be incorrect in the future. FLS are not guarantees of future performance. Actual events could differ materially from those expressed or implied in any FLS. A number of important factors including those factors set out above can contribute to these digressions. You should avoid placing any reliance on FLS.
TD ETFs are managed by TD Asset Management Inc., a wholly-owned subsidiary of The Toronto-Dominion Bank.
TD Asset Management Inc. is a wholly-owned subsidiary of The Toronto-Dominion Bank. ®The TD logo and other TD trademarks are the property of The Toronto-Dominion Bank or its subsidiaries.
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