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iShares Alternatives Completion Portfolio Builder Fund - XAL

ETF Overview

The fund seeks to provide long-term capital growth by investing primarily in iShares ETFs, managed by BlackRock Canada or an affiliate, that provide exposure to one or more alternative asset classes.

The fund will ordinarily invest in iShares ETFs, but may also use individual securities and/or derivatives to gain exposure to these asset classes.

BlackRock will seek to create an asset allocation for the fund through a proprietary multi-factor selection process that seeks to identify and optimally diversify certain fundamental sources of return.

Alternative asset classes includes but is not limited to, commodities, real estate investment trusts, income trusts, real return bonds, emerging market equities, emerging market bonds, high yield bonds, specialty equities, infrastructure and private equity.

The fund is intended to complement an investor's portfolio that consists primarily of Canadian equities, Canadian nominal bonds and large capitalization international equities from developed markets and as such, it will not typically invest in iShares ETFs, other issuers, or derivatives which provide exposure to these asset classes.

The fund may also employ currency hedging.

Key ETF Data

Fundamentals
Category (main) Global (non-Canada) multi-asset classes - Alternatives Growth
Category (other)Fund of funds
Underlying Index No Index
ETF Structure ETF of ETFs (ie fund of funds)
Asset Class Multi-asset classes
Region Global (excludes Canada)
Issuer iShares Canada by Blackrock
ETF Home Page Available here
Fund Facts
Inception Date 13 Nov 2008
Total Holdings 8 (2,127) *1
Distribution Frequency Semi-Annual
Leverage None
Significant Currency Exposure Yes
Currency Hedging Maybe *2

*1 Holds various iShares ETFs

*2 Prospectus states fund MAY employ currency hedging

Fees
Management Fee 0.70%
Management Expense Ratio (MER) 0.73%
Trading Information
Ticker XAL
Exchange TSX (Toronto Stock Exchange)
Currency CAD
Eligibility
Eligibility * RRSP, RRIF, RESP, TFSA, DPSP, RDSP
DRIP available ** Yes
PACC Plan available ** No
SWP available ** No

* Always check eligibility with your plan operator as plans and accounts can differ

** Not all brokers can facilitate these plans. Check with your broker.

Current Price, Fund Performance, Yield, NAV, Charts etc

To view the TSX or Morningstar fund page for this ETF click on the Fund Data menu tab or below:

ETF at TMX ETF at Morningstar

ETF Analysis

Blackrock need to improve their website and fund Fact Sheets.

Neither make these important aspects clear for this fund:

  • whether currency hedging is employed to mitigate or eliminate currency risk - we had to search through a 60+ page prospectus to determine that the fund MAY employ currency hedging at the discretion of the Blackrock fund manager
  • discretionary hedging is not good enough - the potential investor does not know whether it will be employed or not, so they do not know to the extent to which they are exposed to currency risk
  • the Canadian dollar has gained or lost up to 20% in a given year against the US dollar so currency risk is a significant risk no investor should ignore or take lightly

Given this is a fund-of-funds, we also encourage Blackrock to look at ways of reducing the fund's MER ().