A unique offering that replicates an exposure of structured notes to complement your traditional balanced portfolio.
That age-old problem – you need higher cash flow to fulfill your investment goals yet are sensitive to market volatility. Our solution: Convergence investing.
Convergence investing aims to democratize access to capital markets solutions. Our mission is to provide investors with sophisticated, defined-outcome investment tools in the format of a traditional mutual fund.
Structured notes are investments designed to achieve a structured investment payout. They provide tailored exposure to a range of reference assets, including equity indices, interest rates, and more.
Depending on the structure, they can be geared toward income, growth, or both. The goal is to deliver a risk/return profile that sits somewhere between traditional bonds and higher-risk market exposures – offering enhanced return potential while managing downside risk.
Right in the sweet spot.
BMO Strategic Equity Yield Fund (SEYF) aims to replicate exposure to notes focused on cash flow generation, while also maintaining contingent downside protection. Our team seeks to achieve above market returns with exposure to North American and/or global equity markets through the use of derivatives and/or structured products.
The secret sauce: auto-callable notes.
The process of managing a portfolio of structured notes can be expensive and time-consuming. Not anymore. The BMO Strategic Equity Yield Fund makes it simple and stress-free to replicate that exposure, putting a whole new asset class within your reach.
BMO Strategic Fixed Income Yield Fund (SFIYF) seeks to replicate the outcome of an actively managed portfolio of diversified structured interest rate notes to generate higher yield without the added credit risk.
Structured interest rate notes are a type of structured product that are designed to provide a customized cash flow stream that can adjust with market conditions, offering stability and the opportunity for enhanced yield compared to traditional fixed income investments.
We have established the first in-house division for Convergence investing in Canada. Our team is composed of highly tenured experts with a combined 100+ years of experience in capital markets. The specialized group will continue to build defined-outcome investment products that enhance traditional asset allocation.
Investors, speak to your financial advisor or email us directly .
Advisors, please contact your your BMO wholesaler .
1BMO Strategic Equity Yield Fund Performance (F Series): -0.96% (1mo) -2.57% (3mo), -2.46% (6mo), 3.39% (1yr), 2.75% (Since Inception, June 16, 2023). Source: Morningstar, as of April 30, 2025.The Target Distribution Yield was calculated by using the annualized distribution yield (which may be based on income, dividends, return of capital and option premiums as applicable) of the underlying portfolio and excluding any capital gains from portfolio turnover, less expenses. The distribution rate is based on the starting NAV of $10. Distribution yield is not an indicator of overall performance and will change based on market conditions, NAV fluctuations, and is not guaranteed.
2All investments involve risk. The value of a Mutual Fund can go down as well as up and you could lose money. The risk of a Mutual Fund is rated based on the volatility of the Mutual Fund’s returns using the standardized risk classification methodology mandated by the Canadian Securities Administrators. Historical volatility doesn’t tell you how volatile a Mutual Fund will be in the future. A Mutual Fund with a risk rating of “low” can still lose money. For more information about the risk rating and specific risks that can affect a Mutual Fund’s returns, see the BMO Mutual Fund’s simplified prospectus.
3The secured overnight financing rate (SOFR) is a benchmark rate that reflects the cost of borrowing overnight, backed by U.S. Treasury securities in the repo market.
4A fund in a National Instrument 81-102 format is a type of investment fund that follows strict rules set by Canadian regulators to help protect investors.
Commissions, trailing commissions (if applicable) , management fees and expenses all may be associated with mutual fund investments. Please read the fund facts or simplified prospectus of the relevant mutual fund before investing. The indicated rates of return are the historical annual compounded total returns for the period indicated including changes in unit value and reinvestment of all distributions and does not take into account sales, redemption, distribution or optional charges or income taxes payable by any unitholder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. Distributions are not guaranteed and are subject to change and/or elimination.
For a summary of the risks of an investment in BMO Mutual Funds, please see the specific risks set out in the simplified prospectus.
BMO Mutual Funds are managed by BMO Investments Inc., which is an investment fund manager and a separate legal entity from Bank of Montreal. Distribution yields are calculated by using the most recent regular distribution, or expected distribution, (which may be based on income, dividends, return of capital, and option premiums, as applicable) and excluding additional year end distributions, and special reinvested distributions annualized for frequency, divided by month end net asset value (NAV).
Distributions are not guaranteed, may fluctuate and are subject to change and/or elimination. Distribution rates may change without notice (up or down) depending on market conditions and NAV fluctuations.
The payment of distributions should not be confused with a BMO Mutual Fund’s performance, rate of return or yield. If distributions paid by a BMO Mutual Fund are greater than the performance of the investment fund, your original investment will shrink. Distributions paid as a result of capital gains realized by a BMO Mutual Fund, and income and dividends earned by a BMO Mutual Fund, are taxable in your hands in the year they are paid.
Your adjusted cost base will be reduced by the amount of any returns of capital. If your adjusted cost base goes below zero, you will have to pay capital gains tax on the amount below zero.
Distributions, if any, for all series of securities of a BMO Mutual Fund (other than ETF Series) are automatically reinvested in additional securities of the same series of the applicable BMO Mutual Fund, unless the securityholder elects in writing that that they prefer to receive cash distributions. For ETF Series securities of a BMO Mutual Fund, distributions, if any, may be paid in cash or reinvested automatically in additional ETF Series securities of the applicable BMO Mutual Fund and the ETF Series securities will be immediately consolidated such that the number of outstanding ETF Series securities following the distribution will equal the number of ETF Series securities outstanding prior to the distribution. If a securityholder is enrolled in a distribution reinvestment plan, distributions, if any, will be automatically reinvested in additional ETF Series securities of the applicable BMO Mutual Fund pursuant to the distribution reinvestment plan. For further information, see the distribution policy for the applicable BMO Mutual Fund in the simplified prospectus. This communication is for information purposes. The information contained herein is not, and should not be construed as, investment, tax or legal advice to any party. Particular investments and/or trading strategies should be evaluated relative to the individual’s investment objectives and professional advice should be obtained with respect to any circumstance.
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