From CLOs to 3x Bets: New ETFs Shake Up the Canadian Market
Canadian investors now have two new ways to play: high-quality yield or high-octane trades.
The Canadian ETF space just got a shot of adrenaline with two bold launches this week, catering to very different corners of the investor spectrum—income seekers and aggressive traders.
CIBC Targets Income Hunters with CLO-Powered CCLO
CIBC has unveiled the CIBC Income Advantage Fund ETF (CCLO) on Cboe Canada, offering Canadian investors exposure to an often-overlooked corner of the fixed income market: AAA-rated U.S. Collateralized Loan Obligations (CLOs). With a floating-rate structure and currency hedging built-in, CCLO is designed to deliver enhanced income while managing both interest rate and FX risk.
Why CCLO Could Matter
- Enhanced income potential: With yields under pressure in traditional fixed income, CLOs offer an alternative that could boost payouts.
- Top-tier credit quality: The ETF invests primarily in AAA-rated tranches, the highest-rated slices of the CLO capital stack, with selective exposure to AA and A-rated securities.
- Interest rate protection: CLOs are typically floating rate, meaning income can rise with rates—helping offset inflation or central bank shifts.
- Diversification: CLOs have historically shown low correlation to government bonds, offering portfolio resilience and reduced volatility.
As Canadian investors look to adapt to the post-rate-hike environment, CCLO steps in with a solution aimed at preserving capital while delivering yield.
LongPoint Unleashes Canada’s First Triple-Leveraged ETFs
In a landmark move for active traders, LongPoint Asset Management is launching Canada’s first-ever suite of triple-leveraged and inverse ETFs—all trading in Canadian dollars starting Friday, May 23.
Branded as the Mega ETFs, the initial rollout includes six products:
- 3x Long: QQQU – Nasdaq-100 SPYU – S&P 500 SOXU – U.S. Semiconductors
- -3x Inverse: QQQD – Nasdaq-100 SPYD – S&P 500 SOXD – U.S. Semiconductors
These ETFs aim to deliver three times the daily performance (or inverse) of their underlying indices, catering to short-term, high-conviction strategies.
But that’s just the first wave.
On May 29, LongPoint plans to list five more tickers, giving leveraged exposure to Canadian banks, gold miners, and U.S. Treasuries. The goal? Give Canadian investors access to aggressive trading tools without crossing the border—or the currency line.
Please note this article is for information purposes only and does not in any way constitute investment advice. It is essential that you seek advice from a registered financial professional prior to making any investment decision.
