By Morningstar Canada | 01/11/17

Evolve Funds Group Inc. has agreed to take over the management contracts of the Sphere family of exchange-traded funds. The friendly deal would provide Evolve with a suite of ETFs in five core equity categories, complementing its existing line-up that is dominated by sector-specific and specialty mandates.

About the Author
Morningstar Canada, a subsidiary of Morningstar Inc., is a leading provider of independent investment research and data. We provide extensive reporting, analysis and commentary on investments and personal finance. The editorial team can be reached at feedback@morningstar.com with your comments and questions, but we cannot provide personal advice.

All five of the Sphere ETFs are based on "sustainable yield" indexes maintained by the FTSE organization. These strategies would continue under Evolve's sponsorship. The transaction is subject to unitholder and regulatory approval. Unitholder approval will be sought at special meetings of the ETFs to be held on Dec. 11.

The affected ETFs are Sphere FTSE Canada Sustainable Yield Index (SHC), Sphere FTSE US Sustainable Yield Index (SHU), Sphere FTSE Europe Sustainable Yield Index (SHE), Sphere FTSE ASIA Sustainable Yield Index (SHA) and Sphere FTSE Emerging Markets Sustainable Yield Index ETF (SHZ).

Today's announcement of the agreement to sell to Evolve comes less than 18 months after Sphere Investment Management Inc. opened for business in April 2016. Despite having licensed indexes from a world-class provider, Sphere struggled to attract assets. Its ETFs now manage a combined total of $68 million.

Evolve is even newer, having launched its first two ETFs on Sept. 20, and smaller. It now has assets of $21.7 million in eight ETFs. Including both currency-hedged and unhedged units, Evolve has a total of 13 listings on the Toronto Stock Exchange.

Don’t miss out on communications from Morningstar Canada! Sign up for our specialised newsletters, get early notice of our events, and get access to exclusive promotional content. Manage your subscriptions here.
Video Reports
More...
Click here to view all