| Home |
| Links |
| Learn To Invest |
| Paid Subscriber Login |
| Our Performance |
| Testimonials |
| Subscribe to Stock Picks |
| Our Articles |
| About Us |
| Free Newsletter |
| Contact Us |
InvestorsFriend's one-stop Canadian ETF reference Site provides:
- Selected Canadian Exchange Traded Funds (ETFs) and ETF trading symbols
- Fundamental data for each selected Canadian ETF (P/E ratio and dividend yield on the fund as well as dividend yield on the under-lying index)
- Links to updated P/E ratio, dividend and other info on each ETF's underlying index
- Links to Yahoo Finance for each Canadian ETF for an updated price and news items
- Management Expense Ratio (MER) of each selected Canadian ETF.
- Fundamentals on TSX market segments for which no Canadian ETF is available.
- Includes Canadian Fixed Income Bond Exchange Traded Funds ETFs as well
- Links to the sponsor web site of each ETF for updated fundamentals and where the companies in each ETF and the weight of each company can be seen
- Now includes physical Gold ETFs, physical Silver ETFs, Oil ETFs, and Natural Gas ETFs
With this one article a diversified Canadian ETF Exchange Traded Fund portfolio could be selected and purchased within an hour or so.
We provide the P/E and dividend yields as of May 29, 2010. But we also provide links so that you can check the latest P/E, dividend yield and Canadian ETF prices. Therefore this Canadian ETF reference article can be used at any date, not just near the date it was last updated.
Keep in mind that P/E ratios and yields (and the resulting valuation comments) are based on the earnings and dividend information available at a point in time. For example the figures below updated May 29 would generally reflect Q1 earnings. Ratios are always subject to change as financial results change and as the ETF prices change. You can click to see the updated P/E and yield as earnings get reported and as the ETF prices change. If the earnings are expected to rise or fall substantially compared to the earnings in the most recent four quarters reported, then the most recent P/E ratio would not be reliable as a valuation indicator. Nevertheless, the trailing P/E ratios are what they are, and investors should find value in being aware of them.
Keep in mind that stocks are volatile and a segment that looks attractive on trailing earnings may not be attractive if earnings fall sharply, but the opposite applies if earnings start to rise rapidly.
See also our article on selected global ETFs Exchange Traded Funds.
| TSX Segment Index | Trailing P/E (Click for update) | Dividend Yield % (Click for update) | ETF Stock Symbol, Price as at May 29, '10 and MER (Click for updated price) | Comment Note the valuation comments are based on the trailing P/E ratios and the yields. As noted below the P/E at times may not represent a good indication of value if the earnings are expected to change readily compared to the trailing earnings. |
|
HIGHER YIELDING CANADIAN EQUITY ETFs |
||||
| S&P/TSX Income Trust Index and TSX Income Trust ETF | 22.2 | 8.0%
(index)
4.51%
|
XTR $11.42 (0.55% MER) |
The P/E is not attractive. Yield on the index is attractive but yield on the ETF is much lower - perhaps due to fund expenses. Many Trust earnings are volatile with energy prices. When taxation hits in 2011, yields and earnings are likely to fall, perhaps substantially. |
| S&P/TSX Capped Financials Index and TSX Financials ETF and TSX Financials bull ETF and TSX Financials bear ETF | 13.1 | 3.9%
(index)
3.8% XFN 0% HFU, HIE and HFD |
XFN
$22.33 (0.55% MER) HFU $10.75 (1.15% MER) 2 times bull |
About 24 companies dominated by the big banks and life
insurance companies. Looks
attractive Note that leveraged ETFs (2 or three times bull or bear) are known to perform as expected for short-term holding periods but may not perform as expected over longer holding periods. Click on the ETF symbol to see a graph that illustrates the problem. |
| S&P/TSX Capped Real Estate Index TSX Real Estate ETF | 16.0 | 5.0%
(index)
3.7% XRE |
XRE $12.00 (0.55% MER) |
13 companies. Real Estate has a habit of usually looking very expensive on an earnings basis. The yield looks good and right now the P/E is reasonably attractive. |
| S&P/TSX Capped Telecommunications Index | 13.3 | 6.2% | No ETF | Only about 5 companies. Looks attractively priced. But there is no ETF... |
| S&P/TSX Capped Utilities Index | 17.7 | 5.0% | No ETF | 9 companies. No ETF |
| S&P/TSX Capped Energy Trust Index | 23.8 | 7.8% | No ETF | 21 companies. Also faces the issue of taxation in 2011. No ETF. |
| S&P/TSX Capped REIT Index | 29.2 | 6.6% | No ETF | 10 companies. Same comments as for Real Estate Index above except the P/E here is very unattractive but the yield is attractive. No ETF |
| Dow Jones Canada Select Dividend Yield Index TSX Dividend ETF |
14.2 P/B = 1.8 |
4.6%
index
4.0% XDV |
XDV $18.92 (0.50% MER) |
Appears quite attractive. About 30 companies in the ETF. Keep in mind their is a heavy exposure to the big bank stocks. |
| Dow Jones Canada Select Value Index TSX Value ETF |
14.1 P/B = 1.7 |
4.3%
index
3.7% XCV |
XCV $18.87 (0.50% MER) |
61 companies. Appears attractive |
| S&P/TSX Canadian Dividend Aristocrats Index |
P/B = ? |
5.3%
index
4.5% CDZ |
CDZ $18.08 (0.65% MER) |
About 56 companies. Appears attractive. |
| S&P / TSX Preferred Share Index | not Applicable to Preferred | 5.7%
index
5.2% CPD |
CPD $16.29 (0.45% MER)
|
About 58 companies. This appears to be attractive |
| TSX Segment Index | Trailing P/E (Click for update) | Dividend Yield % (Click for update) | ETF Stock Symbol, Price as at May 29, '10 and MER (Click for updated price) | Comment |
|
CANADIAN EQUITY ETFs |
||||
| S&P/TSX Composite index and TSX Composite ETF | 19.7 | 2.8%
index
2.5% XIC |
XIC TSX $18.44 (0.25% MER) |
Appears somewhat over valued. Has a heavy weighting to volatile finance and energy sectors. |
| S&P/TSX 60 (Large Cap) Index and TSX 60 ETF and TSX 60 bull ETF and TSX 60 bear ETF | 18.4 | 2.7%
index
2.8% XIU No dividend on HXU, HIX or HXD |
XIU
$17.25
(0.17% HXU $17.41 (1.15% MER) 2 times bull |
Note the very low management expense fee (ratio). This allows broad exposure to the Canadian stock market at a low fee. Appears somewhat over valued. Has a heavy weighting to volatile finance and energy sectors. Note that leveraged ETFs (2 or three times bull or bear) are known to perform as expected for short-term holding periods but may not perform as expected over longer holding periods. Click on the symbol HXU to see a graph that illustrates the problem. |
| S&P/TSX equity Index (Composite without Income Trusts) | 19.5 | 2.4% | No ETF | Same comment as for composite index above applies |
| S&P/TSX Mid and Small Cap Index (Completion Index) and TSX mid-cap ETF | 25.4 | 3.1%
index
2.4% XMD |
XMD $18.68 (0.55% MER) |
Seems unattractive |
| S&P/TSX Small Cap Index and TSX small cap ETF | 97 | 3.0%
index
1.6% XCS |
XCS $14.44 (0.55% MER) |
Seems highly unattractive |
| S&P/TSX Capped Consumer Discretionary Index | 27.0 | 2.8% | No ETF | There are only about 18 companies in the index, some are poor fits. (Yellow pages, Thompson Reuters??) Seems like a meaningless sector. |
| S&P/TSX Capped Consumer Staples Index | 14.7 | 1.9% | No ETF | Neutral in attractiveness. Only about 12 companies mostly retail. |
| S&P/TSX Capped Metals & Mining Index | 14.0 | 0.6% | No ETF | About 13 companies. |
| S&P/TSX Capped Energy Index and TSX Energy ETF and TSC Energy bull ETF and TSX Energy bear ETF | 23.6 | 2.8%
index
2.4% XEG No dividend on HEU, HIF or HED |
XEG
$17.66 (0.55% MER) HEU $6.93 (1.15% MER) 2 times bull |
About 43 companies. Looks unattractive but that depends on oil and gas prices. |
| S&P/TSX Capped Health Care Index | n.a. | 2.7% | No ETF | With about 4 companies, it is a joke to call this a segment. |
| S&P/TSX Capped Industrials Index | 16.2 | 2.4% | No ETF | About 19 companies many of which are not all that "industrial". |
| S&P/TSX Capped Information technology Index and TSX Information Technology Tech ETF | 17.8 | n.a
index
n.a. XIT |
XIT $7.28 (0.55% MER) |
Appears unattractive - only about 5 companies in this so-called "index" |
| S&P/TSX Capped Materials Index TSX Materials ETF | 133 | 0.5%
index
n.a. XMA |
XMA $18.39 (0.55% MER) |
50 companies, looks most unattractive and earnings here are unpredictable |
| Dow Jones Canada Select Growth Index TSX Growth ETF |
19.3 P/B = 2.2 |
1.2%
index
1.4% XCG |
XCG $21.39 (0.50% MER) |
61 companies appears moderately unattractive. |
| Claymore Oil Sands
Sector ETF (note, fundamentals only updated quarterly) |
24.6 P/B = 1.9 |
1.8%
index
1.8% CLO |
CLO
$16.26 (0.60% MER)
|
17 companies. This currently looks unattractive but valuation will change with oil prices. |
|
FIXED INCOME ETFs |
||||
| Bond Type (Click for updated yield to maturity and to see the individual bonds in the index) | Average Term of Bonds in Years | Average Yield to Maturity before MER on index and cash yield on ETF | ETF Stock Symbol, Price as at Jan 16, '10 and MER (Click for updated price) | Comment (Bonds and Bond ETFs are more suitable to tax-sheltered accounts than taxable) ETF yield may be higher than the true return you will get because these bonds trade at a premium |
| ishares Canadian Bond ETF (Mix of Government and Corporate) | 8.5 | 3.2%
index
4.1% XBB |
XBB $29.58 (0.30% MER) |
Does not appear
attractive and it will fall in price if interest rates rise. Expect a small capital loss even if interest rates are stable, best indication of true expected return is index yield minus MER! Actual return is unpredictable. |
| ishares Canadian Corporate Bond ETF | 7.6 | 3.9%
index
4.4% XCB |
XCB $20.30 (0.40% MER) | Not very attractive
It will fall in price if the recession worsens
and the probability of corporate bankruptcies rises, and/or if interest
rates rise.
Expect a small capital loss even if interest rates are stable, best indication of true expected return is index yield minus MER!Actual return is unpredictable. |
| ishares Canadian Government Bond ETF | 8.7 | 3.0%
index
3.8% XBG |
XGB $20.48 (0.35% MER) | Does not appear
attractive.
Expect a small capital loss even if interest rates are stable, best indication of true expected return is index yield minus MER! Actual return is unpredictable. |
| ishares Canadian Long Bond ETF (mix of government and corporate) | 21.5 | 4.5%
index
4.5% XLB |
XLB $20.09 (0.35% MER) | Attractive yield but with its long maturity it will fall heavily if
interest rates rise.
Expect a small capital loss even if interest rates are stable, best indication of true expected return is index yield minus MER! Actual return is unpredictable. |
| ishares Canadian Real Return Bond ETF | 20.9 | 1.4%
plus inflation index
2.4% XRB |
XRB $20.88 (0.35% MER) | Worth considering for inflation protection, but you can buy a real return bond directly and avoid the MER, although you will pay a bid/ask spread. Real return bonds do not at all protect against a rise in the real (before inflation) interest rates. Real interest rates are at historic lows so that represents a danger to this fund. |
| ishares Canadian Short Bond ETF | 2.7 | 2.3%
index
3.6% XSB |
XSB $28.96 (0.25% MER) |
2.3% minus the MER is
not very attractive. But may be a reasonable alternative to cash in a
brokerage account.
Expect a small capital loss even if interest rates are stable, best indication of true expected return is index yield minus MER!, not the cash yield on the ETF |
| General comments on Bonds: Bond interest is taxed more heavily than share dividends or capital gains. Therefore they are more suitable for tax-sheltered savings accounts. (RRSP, RESP, Tax Free Savings Account). Longer term bonds will fall in value if interest rates rise. Bonds, an especially longer term bonds fall in price when interest rates rise. Interest rates are currently at record lows and therefore there is a high risk that interest rates will rise and that bond prices will fall. The real return bond partly protects against that risk. Corporate Bonds fall in price when corporate profits fall and or whenever corporations are viewed as more risky. Bond and Bond ETF cash yields can be higher than the underlying yield to maturity - don't be misled - the offset would be an expected capital loss as the bonds are trading at a premium to their maturity price. | ||||
|
GOLD AND COMMODITY ETFs |
||||
| Commodity Type | P/E Ratio | Yield | ETF Stock Symbol, Price as at Jan 16, '10 and MER (Click for updated price) | Comment |
| S&P/TSX Global Gold Index TSX Global Gold ETF |
Note: P/E ratio not available | 0.8%
index
0.1% XGD No dividends on the bear/bull ETFs |
XGD
$22.55 (0.55% MER) HGU $13.71 (1.15% MER) 2 times bull |
37 Global gold companies. My experience has
been that gold companies tend to be often over-priced due to a "lottery ticket"
mentality. The symbols starting with H here trade on Toronto in Canadian dollars - but not hedged. Note that leveraged ETFs (2 or three times bull or bear) are known to perform as expected for short-term holding periods but may not perform as expected over longer holding periods. Click on the ETF symbol to see a graph that illustrates the problem. |
|
HBP COMEX®
GOLD ETF (HUG) |
not applicable | not applicable | HUG
$12.64 MER 0.65% |
Gold itself as a commodity in Canadian
dollars and hedged to remove currency risk Endeavors to correspond to the performance of the COMEX® gold futures contract for a subsequent delivery month i.e. It does not own physical gold In a stable market with an upward sloping futures price, it would by nature lose money as each futures bought each month tends to be more expensive than the value of the expiring contract being sold. |
| Claymore Gold Bullion Trust | not applicable | not applicable | CGL
MER = 0.50% |
This is gold itself as a commodity. This Trust owns physical Gold |
|
ISHARES COMEX Gold Trust TSX Gold Commodity ETF |
not applicable | not applicable | IGT
$124.80 (0.40% MER) This is the American MER, possibly it is higher in Canada. |
This is gold itself as a commodity. This is a
U.S. gold ETF that also happens to trade on the TSX in Canadian dollars.
This Trust owns physical Gold |
| Claymore Silver Bullion Trust | not applicable | not applicable | SVR.un
MER = 0.60% |
This is silver itself as a commodity. This Trust owns physical Silver |
| HBP
COMEX® SILVER ETF (HUZ) |
not applicable | not applicable | HUZ
MER 0.65% |
Silver as a commodity in Canadian
dollars and hedged to remove currency risk Endeavours to correspond to the performance of the COMEX® silver futures contract for a subsequent delivery month - it does not own physical silver. In a stable market with an upward sloping futures price, it would by nature lose money as each futures bought each month tends to be more expensive than the value of the expiring contract being sold. |
| HBP
WINTER NYMEX® CRUDE OIL ETF (HUC) |
not applicable | not applicable | HUC
MER 0.75% |
Emulates December contract for NYMEX light sweet
Crude. Priced in Canadian dollars and Hedged. This should go up if December futures price for oil rises. And the reverse. This ETF may lose money when it ultimately sells the December 2010 contract and presumably buys the December 2011 contract Here is a link to the December futures price |
|
HBP NYMEX® Crude Oil Bull Plus ETF
|
not applicable | not applicable | HOU
$6.40
$11.10 |
2x Bull Attempts to emulate a 200% continuous
exposure to the next month's oil futures contract on the New York Mercantile
Exchange
2x Bear Attempts to emulate a 200% continuous exposure to selling the next month oil futures contract on the New York Mercantile Exchange In Hedged Canadian dollars Note that leveraged ETFs (2 or three times bull or bear) are known to perform as expected for short-term holding periods but may not perform as expected over longer holding periods. Click on the links to see a graph that illustrates the problem.
|
| Claymore Natural Gas Commodity ETF | not applicable | not applicable | GAS | The ETF will provide non-leveraged
exposure to the Alberta natural gas market, by investing in physical natural
gas forward contracts. (Which means it does not hold physical natural
gas in storage)
The NGX Canadian Natural Gas Index replicates an exposure to the monthly contract (1-month spot price) for physical natural gas for delivery on the TransCanada Mainline (AECO/NIT) in Alberta, that is rolled to the next contract prior to delivery. In the situation of a stable price and an inclining forward price curve this index would face a natural loss as each monthly contract may tend to decline through the month and the sold month may be cheaper than the next month it has to buy. Buying this ETF is a bet that natural gas prices will rise. Past prices of the Alberta Natural Gas index are available here. |
| HBP
WINTER NYMEX® NATURAL GAS ETF (HUN) |
not applicable | not applicable | HUN
MER 0.75% |
Emulates January contract for NYMEX Natural Gas.
Priced in Canadian dollars and Hedged This ETF should go up if the January natural gas price rises. And the reverse. Also may lose money when it has to sell January 2010 to buy January 2011. Here is a link to the January Futures Price |
|
HBP NYMEX® Natural Gas Bull Plus ETF
|
not applicable | not applicable | HNU
$5.77
$7.42
|
2x Bull Attempts to emulate a 200% exposure to
the next month Natural gas future on New York Mercantile Exchange
2x Bear Attempts to emulate a 200% exposure to selling the next month Natural gas future contract on the New York Mercantile Exchange In Hedged Canadian dollars Note that leveraged ETFs (2 or three times bull or bear) are known to perform as expected for short-term holding periods but may not perform as expected over longer holding periods. Click on the links to see a graph that illustrates the problem. |
For those interested in Canadian ETFs this is an excellent reference article. You can bookmark it and also join our free newsletter list to be advised of periodic updates to this table.
For those segments that show an entry in the Canadian "ETF" column, this means that a Canadian Exchange Traded Fund is available. These Canadian ETFs trade just like stocks on the Toronto Stock Exchange and the trading symbol is provided. Buying the Exchange Traded Fund gives convenient exposure to the segment.
Where an ETF exists, you can buy it just like buying a stock.
With the information above investors can make a judgment as to the desirability of various segments of the Canadian market and we provide the trading symbol under which each can be purchased. (Or sold short for that matter).
This can help you decide which sectors are most (or least) attractive. (Financial, Energy, Real Estate etc.). For those sectors with an ETF available, you can then easily buy that sector by buying the Exchange Traded Fund.
While it can be very difficult to interpret whether a particular P/E ratio is attractive or not, it is useful to be aware of these ratios. Note that most of the indexes are "capped" which means that the contribution of any one company to the index is capped or limited to a certain level. In theory the P/E ratio of an index should be more meaningful than the P/E for an individual stock since the group of companies that make up an index are less prone to unusual gains and losses since these tend to average out. But in some cases they do not average out and an index P/E could be affected by large unusual gains or losses at individual companies or something unusual that is affecting the entire sector.
Note that the sectors contain corporations as well as Income Trusts, the inclusion of Trusts has driven the dividend yields higher compared to the situation before Trusts were added to the indexes.
Also note that some of these sectors contain less than 10 companies which is really not enough to be representative of a sector.
Where there is no ETF, you cannot buy the index and would need to pick and choose individual stocks or find mutual funds that focus on the sector.
The ETF's that start with "X" are from from www.ishares.ca The Canadian ETF's that start with "H" are by Horizon beta pro and are either a two times bullish bet on the segment or a two times bear bet against the segment. Use caution and see http://www.hbpETFs.com/ for more information. The ETF's that start with a "C" are by Claymore Investments. We have not so far included the Bank of Montreal ETFs partly because we could not find the P/E and yield data.
In buying or selling any of these Canadian ETFs be cautious about the trading volume and the bid/ask spread. Higher volume ETFs are preferred, all else being equal.
In buying any of these, be careful to double check the Canadian ETF trading symbol with other sources. I believe the symbols above are correct, but please double check. A wrong symbol could lead to to the wrong investment. Also check the latest P/E ratios and dividend yield by clicking the links above. When clicking links check that it goes to the Canadian ETF name that you expect.
Investors may wish to consider the expected growth or contraction of the earnings that are driving the P/E for a particular segment. High growth can justify a high P/E and low or negative growth leads to lower P/E ratios. Also for some industries like mining and real estate, the GAAP earnings may arguably understate sustainable free cash flow therefore justifying a higher P/E. For more on this see our articles on understanding P/E ratios. Possibly, some segments, which may not have a lot of companies in the sector, are affected by one or two companies within the sector having unusual losses or gains.
END
Shawn Allen, CFA, CMA, MBA, P.Eng.
President, InvestorsFriend Inc.
May 29, 2010
www.investorsfriend.com