Tactical Allocation Customized Thematic Investment Company

Transcription

1 BMO Capital Markets BMO TACTIC Funds Tactical Allocation Customized Thematic Investment Company This offering is made only by prospectus. The prospectus contains important detailed information about the securities being offered. Copies of the prospectus may be obtained from a registered dealer or from BMO Nesbitt Burns Inc. by calling toll-free at (English) or (French), or by ing BMO Nesbitt Burns Inc. at admin.dealerservices@bmonb.com. Investors should read the prospectus before making an investment decision.

2 Investors need solutions that are 1 Built for the way they see the world We live in a world of insights, but as investors, we can t always act on them Want to invest in connected cars, shale oil, fintech, clean technology and so on? The investment industry doesn t make it easy because there are few available investment products and investors can be lost or overwhelmed Who has the time to follow a particular stock and stay on top of corporate news and earnings reports? 2 Built for how they think and work We think in terms of ideas, insights and trends Advisors and their clients are looking for investments that allow them to express a view Many investors would prefer to invest in a particular industry or asset class versus trying to pick a specific company in that industry or asset class 3 Built for transparency and control Some investments offer a less than clear picture of holdings and performance It would be ideal to see what you own and how your investments are performing at all times

3 BMO TACTIC Funds A Unique New Investment Solution TACTIC definition: noun tac tic \taktik\: an action or method that is planned and used to achieve a particular goal Tactical Allocation Customized Thematic Investment Company ( TACTIC ) has been developed as a platform for the issuance of customized investment solutions based on a set of timely and opportunistic investment themes Thematic investing isn t new, but widespread access to it is Professional and high net-worth investors have been successfully investing around a central theme, trend or strategy for decades The BMO TACTIC Funds platform is a hub for investors to tactically express a view based on an investment theme that may have broad or relatively focused appeal, over a short, intermediate or long term investment horizon BMO TACTIC Funds Current Offerings BMO FinTech Sector TACTIC Fund BMO Canadian Top 15 Small Cap TACTIC Fund Unhedged (JHN 10024) (JHN 10025) (JHN 10039) (JHN 10030) (JHN 10031) (JHN 10041) Hedged (JHN 10027) (JHN 10028) (JHN 10040) N/A BMO U.S. Top 15 Small Cap TACTIC Fund (JHN 10033) (JHN 10034) (JHN 10042) (JHN 10036) (JHN 10037) (JHN 10043) Deploy Your TACTIC Tactical Allocation Tactical asset allocation is a dynamic investment strategy that actively adjusts a portfolio s allocation, with the goal of improving risk-adjusted returns Investors can express a view and exploit an investment opportunity in a nimble and timely manner Can be fairly short-term, intermediate or long-term investment, depending on investor s view Customized Investments can be fairly tailored and targeted, allowing for bespoke investment solutions Allows investors to exploit a very focused investment opportunity that may not be found in more broadly-based investment offerings such as mutual funds or ETFs Thematic Minimum Purchase: $500 Investment platform based on narrow or broad investment themes to access and isolate the opportunity More innovative, more likely to know what you own Investment Company BMO TACTIC Funds platform can accommodate many types of strategies Continuously offered with daily subscriptions and redemptions via FundSERV Designed for every type of investor retail, HNW, institutional, fee-based and transaction accounts, etc. Can provide opportunities for tax-efficiency and enhanced returns Tactical Allocation Customized Thematic Investment Company BMO TACTIC Funds 3

4 Ownership of a basket of securities reflecting a consistent investment idea or theme Customizable investment, allowing for bespoke investment solutions What You Get with BMO TACTIC Funds BMO TACTIC Funds ETFs Mutual Funds Closed-End Funds x x Diversification across multiple securities Daily liquidity and pricing Eligible for commission-based or fee-based accounts Opportunities for tax-efficiency and enhanced returns via leverage 3 x x 3 BMO TACTIC Funds Summary of Terms Offering Units (CAD and, if applicable, CAD Hedged) Units (CAD and, if applicable, CAD Hedged) (for fee-based accounts) Units (CAD and, if applicable, CAD Hedged) (for discount brokerage accounts) Minimum Purchase $500 Distributions Currency Hedging Leverage Daily Purchases and Redemptions Upfront Sales Commission Management Fee Service Fee Switching and Conversion of Units Short-term Redemption Fee Termination Manager Portfolio Manager Eligibility The BMO TACTIC Funds will not make regular distributions. Distributions, if any, will be automatically invested in additional Units or paid in Units. Offering unhedged and substantially-hedged versions of Units. Maximum 25% of total assets of each BMO TACTIC Fund. Initially, leverage will not be used. All daily purchases and redemptions will be through the order entry system operated by FundSERV Inc. Units: 0% to 2.00% (negotiated) Units: Nil Units: Nil Units: 1.85% p.a. (including an amount equal to the Service Fee) Units: 0.85% p.a. Units: 0.95% p.a. (including an amount equal to the Service Fee) Units: 1.00% of net asset value of the applicable BMO TACTIC Fund, calculated daily and paid quarterly. Units: Nil. Units: 0.10% of net asset value of the applicable BMO TACTIC Fund, calculated daily and payable quarterly. The Service Fee (or trailing commission) will be paid by the Manager to registered dealers out of the Management Fee. Unitholders may not switch Units of one BMO TACTIC Fund for those of another. Unitholders may convert Units of any class into Units of any other class of the same BMO TACTIC Fund. A BMO TACTIC Fund may, at its sole discretion, charge a short-term redemption fee of up to 1.00% of the amount that an investor redeems if such transaction is done within 90 days of purchase. The BMO TACTIC Funds do not have a fixed termination date. BMO Nesbitt Burns Inc. BMO Asset Management Inc. Eligible for RRSPs, RRIFs, DPSPs, RDSPs, RESPs and TFSAs. 4 BMO Capital Markets

5 BMO FinTech Sector TACTIC Fund Objective & Strategy: To provide long-term capital appreciation by investing in financial technology companies that are publicly traded in the United States. Initially, the BMO FinTech Sector TACTIC Fund will invest in the constituent securities of the KBW Nasdaq Financial Technology Index. The Fund may employ leverage, including through the use of derivatives, to increase its exposure to the portfolio, however it does not initially intend to do so. FinTech Index Selected Companies What is FinTech? The phrase FinTech, first coined by a New York banker in 1972, refers to the intersection of technology and financial services. FinTech is a dynamic segment at the intersection of the financial services and technology sectors where technology-focused startups and new market entrants innovate the products and services currently provided by the traditional financial services industry. (PricewaterhouseCoopers LLP). Fintechs are defined as high-growth organisations combining innovative business models and technology to enable, enhance and disrupt financial services. This definition is not restricted to start-ups or new entrants, but includes scale-ups, maturing companies and even non-financial services companies, such as telecommunication providers and e-retailers. (E&Y). FinTech Index Group Exposure Payments 25.2% Processors / Business Information 27.6% Financial Data 21.8% Exchanges / Automatic Trading 12.6% Networks 5.7% Specialty 3.5% Marketplace Leaders Internet Banks 1.9% Software 1.8% As of January 29, 2018 FinTech Index The KBW Nasdaq Financial Technology Index (FinTech Index) is designed to track the performance of financial technology companies that are publicly traded in the U.S. The FinTech Index is equally-weighted and currently includes 50 companies. These companies leverage technology to deliver financial products and services. These companies have nearly exclusive electronic distribution and limited or no bricks and mortar exposure, and a predominately fee-based revenue mix. FinTech Index Inclusion Criteria To be eligible for inclusion in the FinTech Index, a security or its issuer, as applicable, must meet the following criteria (among others): Be listed on The Nasdaq Stock Market, the New York Stock Exchange or NYSE MKT Be classified as a company that leverages technology to deliver financial products and services. Distribution should be nearly exclusively electronic, with limited to no bricks and mortar, and the revenue mix must be predominantly fee-based Have a market capitalization greater than or equal US$500 million Have seasoned on a recognized market for at least three months Tactical Allocation Customized Thematic Investment Company BMO TACTIC Funds 5

6 BMO Canadian Top 15 Small Cap TACTIC Fund BMO U.S. Top 15 Small Cap TACTIC Fund Objective & Strategy To provide long-term capital appreciation by investing in small and mid-sized Canadian companies included in BMO Capital Markets Canadian Top 15 Small Cap Fundamental List. The Fund may employ leverage, including through the use of derivatives, to increase its exposure to its portfolio, however it does not initially intend to do so. Selected Companies Objective & Strategy To provide long-term capital appreciation by investing in small and mid-sized U.S. companies included in BMO Capital Markets U.S. Top 15 Small Cap Fundamental List. The Fund may employ leverage, including through the use of derivatives, to increase its exposure to its portfolio, however it does not initially intend to do so. Selected Companies Top 15 Lists The BMO Capital Markets Canadian Top 15 Small Cap Fundamental List and the BMO Capital Markets U.S. Top 15 Small Cap Fundamental List are designed to provide investors with the best investment ideas that are rated Outperform by BMO Capital Markets equity research analysts. All of the securities appearing on the list are selected from BMO Capital Markets equity research s Outperform rated stocks and are selected to achieve a degree of diversification within the constraints of the List s objectives, criteria, and availability of suitable Outperform rated stocks. Each Fund will hold the constituent securities on an initially equally-weighted basis. Inclusion Criteria Subject to the Investment Advisor s discretion, to be eligible for inclusion in the portfolio, a security will generally satisfy the following criteria: Have an Outperform rating by the relevant BMO Capital Markets equity research analyst Market capitalization: Canadian Top 15 List: $300 million (min) to $4.9 billion (max) U.S. Top 15 List: US$300 million (min) to US$6.0 billion (max) Have a minimum average trailing-30-day stock closing price of: Canadian Top 15 List: $5.00 U.S. Top 15 List: US$5.00 The List is managed by a committee which meets monthly and solicits comments from analysts on an ongoing basis. 6 BMO Capital Markets

7 Tactical Allocation Customized Thematic Investment Company BMO TACTIC Funds 7

8 Talk with us Learn more For Further Information, please contact Robin Tessier Anoop Dogra Jerome Cloutier Greg Zaludek Julie He Matt Clare Peter Ramey Tasha Konkin David Fecteau Lina Nouraly Prospective purchasers should take into account risk factors associated with the offering. See Risk Factors in the prospectus relating to the offering by the BMO TACTIC Funds (the prospectus ), available through the contact information above. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Prospective purchasers should read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. Mutual fund investments are not insured by the Canada Deposit Insurance Corporation or any other entity. Additional information about each BMO TACTIC TM Fund s portfolio, including a complete list of the companies included in the portfolio from time to time, will be available in the most recently filed annual or interim financial statements of the BMO TACTIC TM Funds. BMO (M-bar roundel symbol), BMO and BMO Capital Markets are registered trademarks of Bank of Montreal used under license. BMO Capital Markets is a trade name used by BMO Financial Group for the wholesale banking businesses of Bank of Montreal, BMO Harris Bank N.A. (member FDIC), Bank of Montreal Ireland p.l.c, and Bank of Montreal (China) Co. Ltd and the institutional broker dealer businesses of BMO Capital Markets Corp. (Member SIPC) in the U.S., BMO Nesbitt Burns Inc. (Member Investment Industry Regulatory Organization of Canada and Member Canadian Investor Protection Fund) in Canada and Asia and BMO Capital Markets Limited (authorised and regulated by the Financial Conduct Authority) in Europe and Australia. Nesbitt Burns is a registered trademark of BMO Nesbitt Burns Inc., used under license. Nasdaq is a registered trademark of Nasdaq, Inc. (which together with Keefe, Bruyette & Woods, Inc. and their affiliates is referred to as the Corporations ) and is licensed for use by the Bank of Montreal. The BMO TACTIC Funds have not been passed on by the Corporations as to their legality or suitability. The BMO TACTIC Funds are not issued, endorsed, sold, or promoted by the Corporations. THE CORPORATIONS MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO THE BMO TACTIC FUNDS. 02/