Investment risk rating calculated using a standardized methodology
Exchange-traded funds (ETF) provider Evolve Funds Group has announced changes to the investment risk ratings of several its ETFs.
The risk rating for Evolve Cyber Security Index Fund has decreased to ‘Medium’ from ‘Medium to High.’ Similarly, the risk rating for the Evolve North American Gender Diversity Index Fund has also decreased to ‘Low to Medium’ from ‘Medium.’
Conversely, the risk rating for the Evolve Automobile Innovation Index Fund increased to ‘High’ from ‘Medium to High, while the risk rating for the Evolve US Banks Enhanced Yield Fund likewise increased to ‘High’ from ‘Medium to High.’
Evolve determines the risk level of an ETF according to a standardized risk classification methodology that is based on the historical volatility of the ETF – which is measured by the 10-year standard deviation of its returns. If an ETF does not yet have 10 years of performance history, the investment risk level is calculated using its return history, and, for the remainder of the 10-year period, the return history of a reference index that is expected to reasonably compare to the ETF’s standard deviation.
The firm specializes in bringing thematic ETFs to Canadian investors, with a portfolio that provides access to long term investment themes and index-based income strategies.
