Brompton Funds Announces Preferred Share Risk Ratings
/EIN News/ -- TORONTO, Aug. 07, 2024 (GLOBE NEWSWIRE) -- (TSX: DGS.PR.A, GDV.PR.A, LBS.PR.A, LCS.PR.A, SBC.PR.A, PWI.PR.A, ESP.PR.A) Brompton Funds announces that the funds listed below (the “Funds”) have voluntarily elected to report risk ratings for their preferred shares (the “Preferred Shares”) on the same basis required for mutual fund investments. The risk ratings are intended to offer a risk classification that is directly comparable to the standard ratings reported by Canadian ETFs and mutual funds. These risk ratings can be considered in addition to the existing credit ratings assigned by Morningstar DBRS to better assess the risk profile of the Preferred Shares.
| Fund Name | Ticker | Risk Rating | Standard Deviation(1) | DBRS Rating |
| Dividend Growth Split Corp. | DGS.PR.A | Low | 5.95% | Pfd-3 (low) |
| Global Divided Growth Split Corp. | GDV.PR.A | Low | 4.03% | Pfd-3 (high) |
| Life & Banc Split Corp. | LBS.PR.A | Low to Medium | 6.95% | Pfd-3 |
| Brompton Lifeco Split Corp. | LCS.PR.A | Low to Medium | 6.17% | Pfd-3 (low) |
| Brompton Split Banc Corp. | SBC.PR.A | Low | 5.51% | Pfd-3 |
| Sustainable Power & Infrastructure Split Corp. | PWI.PR.A | Low to Medium | 7.39% | Pfd-3 |
| Brompton Energy Split Corp. | ESP.PR.A | High | 21.49% | n/a |
| S&P/TSX Preferred Share Index | n/a | Medium (Estimate) | 13.03% | n/a |
| Brompton Index One Split Preferred Share Index | n/a | Low (Estimate) | 5.19% | n/a |
The risk ratings are calculated in accordance with the standardized investment risk classification methodology set out in National Instrument 81-102 Investment Funds. The risk ratings are based on the historical market price volatility of each Preferred Share as measured by the 10-year standard deviation of monthly returns as of July 31, 2024. For Preferred Shares with less than ten years of performance history, the investment risk level of the Preferred Share was calculated using the available return history of the Preferred Share and, for the remainder of the 10-year period, the returns of the Brompton Index One Split Preferred Share Index, to reasonably approximate the standard deviation of the Preferred Share.
The Preferred Shares offer preferential, tax-advantaged quarterly distributions, and have historically delivered stable returns relative to the S&P/TSX Preferred Share Index.(2)
| Compound Annual Returns to July 31, 2024(2) | |||||||
| Ticker | Distribution Rate(3) | 1-Yr | 3-Yr | 5-Yr | 10-Yr | S.I. | Inception |
| DGS.PR.A | 5.4%(4) | 5.6% | 5.6% | 5.6% | 5.5% | 5.4% | 12/03/07 |
| GDV.PR.A | 5.0% | 5.1% | 5.1% | 5.1% | - | 5.1% | 06/15/18 |
| LBS.PR.A | 6.9% | 7.0% | 6.0% | 5.8% | 5.4% | 5.4% | 10/17/06 |
| LCS.PR.A | 6.8% | 6.6% | 6.5% | 6.4% | 6.2% | 5.8% | 04/18/07 |
| SBC.PR.A | 6.1% | 6.4% | 5.8% | 5.5% | 5.1% | 5.2% | 11/16/05 |
| PWI.PR.A | 4.9% | 5.1% | 5.1% | - | - | 5.1% | 05/21/21 |
| ESP.PR.A | 8.1% | 8.3% | 16.1% | 8.1% | - | 6.7% | 02/24/15 |
| S&P/TSX Preferred Share Index | 21.6% | 1.6% | 5.8% | 2.5% | |||
About Brompton Funds
Founded in 2000, Brompton is an experienced investment fund manager with income and growth focused investment solutions including exchange-traded funds (ETFs) and other Toronto Stock Exchange (TSX) traded investment funds. For further information, please contact your investment advisor, call Brompton’s investor relations line at 416- 642-6000 (toll-free at 1-866-642-6001), email info@bromptongroup.com or visit our website at www.bromptongroup.com.
(1) Source: LSEG Datastream. Annualized 10-year standard deviation of monthly returns as of July 31, 2024. For Preferred Shares with less than ten years of performance history, the calculation was based on the available return history of the Preferred Share, and for the remainder of the 10-year period, the returns of the Brompton Index One Split Preferred Share Index.
(2) Returns are for the periods ended July 31, 2024 and are unaudited. The table shows the compound return on the Preferred Shares for each period indicated compared to the S&P/TSX Preferred Share Index (“Preferred Share Index”). The Preferred Share Index tracks the performance, on a market‑weight basis, of a broad index of preferred shares trading on the TSX that meet the criteria relating to size, liquidity and issuer rating. The Preferred Shares are not expected to mirror the performance of the Preferred Share Index, which has a more diversified portfolio. Past performance does not necessarily indicate how the Preferred Shares will perform in the future. The information shown is based on the redemption price per Preferred Share and assumes that distributions made by each Fund on the Preferred Shares in the periods shown were reinvested (at the redemption price per Preferred Share) in additional Preferred Shares of such Fund.
(3) Annualized distribution rate based on closing market price as of July 31, 2024. Source: LSEG Eikon.
(4) On July 26, 2024, Dividend Growth Split Corp. announced that the distribution rate will increase to $0.675 per Preferred Share per annum (6.75% on the par value of $10.00) for the next term from September 28, 2024 to August 30, 2029.
You will usually pay brokerage fees to your dealer if you purchase or sell shares of the Funds on the TSX or other alternative Canadian trading system (an “exchange”). If the shares are purchased or sold on an exchange, investors may pay more than the current net asset value/redemption price when buying shares of a Fund and may receive less than the current net asset value/redemption price when selling them.
There are ongoing fees and expenses associated with owning shares of an investment fund. An investment fund must prepare disclosure documents that contain key information about the fund. You can find more detailed information about each Fund in its public filings available at www.sedarplus.ca. The indicated rates of return are the historical annual compounded total returns including changes in share value and reinvestment of all distributions and do not take into account certain fees such as redemption costs or income taxes payable by any securityholder that would have reduced returns. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated.
Certain statements contained in this document constitute forward-looking information within the meaning of Canadian securities laws. Forward-looking information may relate to matters disclosed in this document and to other matters identified in public filings relating to the Funds, to the future outlook of the Funds and anticipated events or results and may include statements regarding the future financial performance of the Funds. In some cases, forward-looking information can be identified by terms such as “may”, “will”, “should”, “expect”, “plan”, “anticipate”, “believe”, “intend”, “estimate”, “predict”, “potential”, “continue” or other similar expressions concerning matters that are not historical facts. Actual results may vary from such forward-looking information. Investors should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and we assume no obligation to update or revise them to reflect new events or circumstances.
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