BetaPro Management Inc has announced the launch of a U.S. dollar denominated Class A unit of the U.S. Dollar ETF (the “USD Unit”). The USD Units will begin trading on the Toronto Stock Exchange on May 12, 2011, under the symbol DLR.U.
The Canadian dollar denominated Class A unit of the U.S. Dollar ETF (the “CAD Unit”) began trading on the TSX on April 7, 2011, under the symbol DLR.
The U.S. Dollar ETF (also known as “DLR”) seeks to reflect the value of the U.S. dollar, reflected in Canadian dollars, net of expenses, by investing primarily in cash and cash equivalents. The USD Units are priced and transacted in U.S. dollars.
By offering the USD Units, investors now have a cost-effective method to trade DLR in either Canadian or U.S. currency, with an option to redeem their units in either currency.
“Investors who wish to make a foreign currency transaction can purchase DLR in Canadian dollars and sell DLR.U for U.S. dollars proceeds,” said Howard Atkinson, president of Horizons Exchange Traded Funds Inc. “The investor needs only to arrange with their broker that they would like to have their DLR units sold as DLR.U units, or vice versa.”
The ability to transact DLR as a CAD Unit or a USD Unit gives investors the opportunity to access institutional currency conversion pricing for DLR’s annual management fee of only 0.45%.
“Using DLR and DLR.U could be a very cost effective way for many Canadian investors to purchase U.S. dollars or convert their U.S. dollars into Canadian dollars,” said Atkinson.