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The Best Oil ETF Choices for a Canadian Investor

Fund Characteristics.

Fund Details. The United States Oil Fund ® LP (USO) is an exchange-traded security designed to track the daily price movements of West Texas Intermediate ("WTI") light, sweet crude oil. Auspice Canadian Crude Oil Index ETF This is a new ETF from a managed futures specialist with experience creating futures-based ETFs. As it was launched in May , there is little history and no MER or TER available yet.

Investment Objective

The Cohen and Steers Global Realty Majors ETF offers investors an opportunity to benefit from the substantial and growing long-term income streams and diversification.

Ownership of real estate is subject to fluctuations in the value of underlying properties, the impact of economic conditions on real estate values, the strength of specific industries renting properties and defaults by borrowers or tenants.

Real estate is a cyclical business, highly sensitive to general and local economic conditions and developments, and characterized by intense competition and periodic overbuilding. Credit and interest rate risk may affect real estate companies' ability to borrow or lend money.

Click here for terms and indexes used on this page. One cannot invest directly in an index. Investors should consider investment objectives, risks, charges and expenses carefully before investing. The prospectus contains this and other important information. For a prospectus for the above listed funds, please click here.

Please read the prospectus carefully before investing. For additional information on the above listed funds, please click the respective link. Insurance Products Shares of the Portfolios are offered only to participating insurance companies and their separate accounts to fund the benefits of Variable Contracts, and to qualified pension and retirement plans and registered and unregistered separate accounts. Closed-End Funds do not continuously issue shares for sale as open-end mutual funds do.

Since the initial public offering, the Funds now trade in the secondary market. Investors wishing to buy or sell shares need to place orders through an intermediary or broker. The share price of a closed-end fund is based on the market's value. The Fund's investment objective is fundamental and may not be changed without the vote of the Fund's shareholders.

Investors may purchase or sell ETF shares throughout the day through any brokerage account, which will result in typical brokerage commissions. That means it distributes its taxable income to the limited partners shareholders the same way mutual funds and ETFs do and you have to include it in your income. Which is fortunate since the withholding taxes on US LPs is currently That is, the exchange rate that is widely quoted on the news and financial websites is the rate that large traders like banks can trade at, it is not the retail cash rate.

It owns familiar companies like: This ETF also has a large component in tanker companies. If the demand for oil increases, shipping rates will increase, but since the exposure to oil producers is lower it may not be as correlated to oil prices. A call option is a derivative that allows the holder of the call to buy the underlying security at a set price within a specified time frame. If the option is not exercised, the seller keeps the amount received for the option.

Writing call options adds an additional level of risk to the ETF, but it does provide for a steady stream of income. However, all of the active trading adds up to higher cost.

The banks agree to pay the ETF the return on the index in cash, in exchange for an upfront fee. Using the total return swap makes the ETF more tax efficient since it does not receive any dividends and all gains are taxed as capital gains.

However, if you are looking for dividends then consider ZEO instead. Forward agreements are a fairly expensive way to get access to an index, but are an efficient way to get non-recourse leverage and there is no income to pay tax on other than capital gains.

Plus this ETF is more expensive than many mutual funds. This includes pipeline companies and other transportation systems that are used to move petroleum products from production sites to refineries and various refined product distributors.

These types of companies are not typically impacted by movements in crude oil or natural gas prices, hence they are less volatile than producers of oil and natural gas. Companies in those sectors are known for being reliable dividend payers; the current yield on HOG is 3. XEG owns familiar companies like: Any remaining shareholders as of August 28 will receive a final payment sometime after September 4.

If you want to invest directly in oil, you have two options: USO is roughly half the cost of HUC, but you would need to hold it for a minimum of 5 years for the currency conversion costs to outweigh the cost savings.

Plus, ZEO pays a high distribution of 3. The Horizons ETF choice is cheapest at 0. Whether you prefer to invest in oil stocks or crude oil itself, ETFs are a great way to get exposure to oil should prices rebound in the future. He has over 11 years of investment industry experience, including asset allocation, portfolio management, due diligence, compliance and reporting. On the CRA website they have a "non-resident tax ModernAdvisor Blog Guiding you along your financial journey.

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USO is roughly half the cost of HUC, but you would need to hold it for a minimum of 5 years for the currency conversion costs to outweigh the cost savings.

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