Purpose Investments Inc. has announced that its plan to convert the Purpose Floating Rate Income Fund from a closed-end fund to an exchange-traded mutual fund on Aug. 7 will be completed as planned.
As part of the conversion, the fund’s Class A units and Class U units will be renamed “ETF units” and “ETF non-currency hedged USD units”, respectively, and the trading symbol for the Class A units will change from “FLOT.UN” to simply “FLOT”, says Purpose.
New class of units
A new class of units designated as “ETF non-currency hedged CAD units” also will commence trading on the Toronto Stock Exchange under the symbol “FLOT.B”, and other classes of mutual fund units will become available for purchase under the fund’s prospectus.
Existing unitholders of the fund are not required to take any action regarding the announced changes. “As a result of the conversion, existing unitholders automatically will become holders of ETF units or ETF non-currency hedged USD units, as applicable,” says Purpose.
The company says the conversion should provide holders of FLOT.UN and FLOT.U with several benefits, including a lower management fee and a lower expected management expense ratio. Effective June 15, 2018, Purpose reduced the management fee on FLOT.UN and FLOT.U to 0.85% per annum from 1.25%.