The Guggenheim Canadian Energy Income Fund (NYSEArca: ENY), the lone U.S.-listed ETF devoted exclusively to Canadian energy stocks, changed its underlying index to the S&P/TSX Canadian High Income Energy Index at the start of this month.
ENY’s previous index was the Sustainable Canadian Energy Income Index. The ETF uses an interesting methodology to give investors exposure to exploration and production names as well as oil and gas storage and transportation stocks.
If the current quarter’s oil price is above the four quarter moving average oil price, then oil is deemed to be in a bull phase and the allocation is 70% oil sands and 30% high yielding Canadian energy stocks. If the oil price is below the moving average, it is deemed to be in a bear phase, with an allocation of 30% oil sands and 70% Canadian energy stocks. This approach give investor greater exposure to oil while prices are rising and gives higher yields when crude prices decline. [Canada, Commodities and Yield in One ETF]
Guggenheim said shifting ENY to the S&P/TSX Canadian High Income Energy Index will help bolster the ETF’s exposure to high-yielding Canadian energy names. ENY is the twentieth Guggenheim ETF to be linked to an S&P Dow Jones index, according to a statement issued by the ETF sponsor. The index commenced operation on July 25.