Harvest Portfolios Group’s Exchange Traded Funds (ETFs) focus on growth and income through the ownership of the best global businesses. The strategy offers transparent, easy to understand ETFs with competitive fees. The Harvest Way is as simple as that.
Harvest offers 13 ETFs which are divided among eight equity income-oriented ETFs and five that are equity growth-focused. The equity growth focused ETFs generally offer more opportunity for capital appreciation. They focus on emerging or mega investing themes which over time can generate powerful returns.
One ETF focuses on new technology (TSX:HBLK) where the holdings include companies involved in blockchain applications, that include cloud computing and artificial intelligence, and e-commerce. Another is travel & leisure (TSX:TRVL) where millennials have joined their newly retired parents, but with different needs and interests. Space exploration and innovation is a third ETF (TSX:ORBT). This ETF includes companies building space craft and components as well as those launching and repairing satellites for 5G cellphone communications and Internet access. Renewable energy is a fourth growth focused ETF (TSX:HCLN). The transition away from fossil fuels is just beginning and will accelerate over the next few decades. As the sector evolves, investments in wind, solar and hydro will grow. The fifth growth focused ETF is a portfolio of gold giants (TSX:HGGG) that holds the world’s largest producers offering a hedge against inflation and uncertain economic conditions.
The companies held in these ETFs follow the Harvest investment philosophy of investing in companies that Harvest has identified with the greatest potential to provide growth opportunities for the specific industry or mega-trend. These companies are the leaders in their industries and offer a long-term opportunity for investors to grow with them.
Here’s a closer look:
HBLK was launched in 2018 and was Canada’s first blockchain ETF. It holds a cross section of large capitalization technology companies and emerging stand-alone blockchain companies. The ETF’s holdings are designed to evolve as the industry matures. The ETF ended 2020 as the fourth best performing Canadian ETF, with the unit price rising 158%.
The power of blockchain lies in its unique ledger-sharing capabilities. Once entries are made to an electronic contract, agreement or shared document, the entries cannot be changed. Everyone can see the transaction details as they are entered and the time. It makes them tamper proof.
So while cryptocurrencies grab headlines, the potential has spread to most sectors. These include governments, insurance, financial services, healthcare, food safety, and transportation logistics. Blockchain is being used to make existing tasks more efficient and less open to fraud. The ETF has around 50 stocks with the large cap holdings currently at 25% of the portfolio and emerging companies at 75% (as of August 31, 2021). The emerging names have an average market capitalization in the CAD $40 billion range and includes e-commerce leaders: Square, DocuSign and Overstock. The large cap holdings with an average market cap of over CAD $500 billion include Microsoft, IBM and Intel.
This globally diversified ETF holds 30 stocks and captures rising demand for travel in the developing world and increasing leisure in the developed. TRVL follows the Solactive Travel & Leisure Index.
The industry felt the full force of the pandemic, but the underlying trends are strong. Along with rising global affluence and increasing leisure travel by an older demographic, millennials have arrived. They are looking for experience-related travel and are comfortable using online booking sites which make travel more accessible and affordable.
Currently, Hotels, resorts and lodgings including the Hilton and Marriott hotel chains make up the largest component, followed by Airlines, mainly U.S.-based, though the ETF includes Air Canada. The other components are casinos and gaming and booking sites including Expedia Inc., as well as Cruise lines such as Royal Caribbean, Carnival Corp. and Norwegian Cruise Lines. TRVL’s management fee is 0.40%.
ORBT was launched in 2021 and invests in 40 global companies engaged in the development of products and services related to satellites, space flight, space stations and space tourism. ORBT tracks the Solactive Space Innovation Index.
The holdings include large enterprises that have the financial resources to exploit the opportunity, as well as those that benefit from spending by governments plus diversified aerospace and defense companies. The names include Boeing, Airbus, Honeywell, Thales, Northrop Grumman, Lockheed Martin and L3Harris.
These companies are benefitting as governments step back and turn the nuts and bolts of rocket propulsion systems, landing craft, operating systems and launching and maintaining satellites over to them. Satellites and related equipment is a large opportunity as global demand for high speed internet and cellphone communications grows in coming decades. About 40% are mega cap stocks valued at over $10 billion. Another 40% are between $1 billion and $10 billion. The remaining 20% are between $100 million and $1billion.
HCLN holds 40 of the largest global clean energy companies by market capitalization. The ETF is equally weighted and rebalanced semi-annually. The long-term drivers fueling the growth of this sector include: rising global power demand, innovation that has improved clean energy’s cost competitiveness, collaborative global government policies that give incentives for investment, declining costs and rising renewable capacity.
HCLN is focused on renewable power producers and related equipment and services, such as wind turbines and solar panels. Geographically, the current holdings are invested in securities based in North American and Europe, with regional breakdowns of the holdings mainly based in North America and Europe, with select investments in: New Zealand, China, and the U.K. among others.
Harvest Portfolios Group Inc. is pleased to announce that it has filed a preliminary prospectus with the Canadian securities regulators for Canada’s first sports & entertainment industry ETF, the Harvest Sports & Entertainment Index ETF (“HSPN”). This innovative ETF is designed to provide Canadian investors access to the growing and dynamic sports entertainment industry.