Global X Funds has launched the Global X Canada Preferred ETF, an exchange-traded fund that targets Canadian companies that issue preferred stock. The fund tracks the Solactive Canada Preferred Stock Index.

Global X noted that the ETF might appeal to those investors looking for income, since preferred stock combines the characteristics of bonds and equities, paying stable dividends with more frequency than common shares. Since preferred shares have the potential to increase in value, they offer additional income growth potential. Finally, preferred shareholders have priority over common shareholders with regards to company earnings and assets.

Canada has a shrinking budget deficit, high commodity prices and strong economic growth, Global X also said.

“The Global X Canada Preferred ETF provides a relatively efficient way for investors to reap the benefits of this hybrid asset class as well as receive international exposure via the Canadian issuers traded on the Toronto Stock Exchange,” said Bruno del Ama, CEO of Global X. “We are pleased to expand our global offering to income-generating asset classes.”

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