TORONTO, April 29, 2016 — Canadian investment advisors expect the rally in Canadian equities, which started in mid-February, to continue throughout the second quarter of 2016, according to the Q2 2016 Advisor Sentiment Survey (“Q2 Survey”) conducted by Horizons ETFs Management (Canada) Inc. (“Horizons ETFs”).

The Q2 Survey asked Canadian investment advisors for their expectations of returns — bullish, bearish or neutral — on 14 distinct asset classes for the upcoming calendar quarter (Q2 2016).

Advisors were bullish on only six asset classes, which included the S&P/TSX 60™ Index, the S&P 500® Index, NASDAQ-100®, S&P/TSX Capped Financials Index™, S&P/TSX Capped Energy Index™ and crude oil.

The highest bullish sentiment among advisors was for the S&P/TSX 60™ Index. Nearly two-thirds (58%) of Canadian advisors were bullish on broad Canadian equities going into the second quarter. Canadian equities started the first quarter (“Q1”) on a significant negative trajectory, but a big rally in energy and materials (i.e. gold equity) in the second half helped the S&P/TSX 60™ Index finish the quarter on a high note, delivering a 3.45% return.

“Canada had a roaring comeback in Q1, largely due to oil prices, which jumped more than 50% from the depths of January,” said Steve Hawkins, Co-CEO, Horizons ETFs. “Advisors likely perceived this as good news for the broader Canadian economy as a whole, which relies heavily on energy prices for economic growth, particularly in the Western provinces.”

The biggest rise in bullish sentiment was observed in Canadian energy equities, as represented by the S&P/TSX Capped Energy Index™. Bullish sentiment on this asset class increased to 54% in Q2 from 40% in Q1. The S&P/TSX Capped Energy Index™ finished the quarter with a strong 6.62% return. Bullish sentiment also increased on crude oil to 50% in Q2, up from 45% in Q1.

“Crude oil prices are again the big driver of returns for energy stocks, and WTI was up 3.51% last quarter, rallying more than 50% from its lows around $26 a barrel during the depths of February,” said Mr. Hawkins. “The strong increase in bullish sentiment for crude oil seems to be a strong indicator on the part of advisors that they think energy prices, and by extension energy stocks, can rally further in Q2.”

Gold and gold-related equities both saw strong returns last quarter. However, approximately a third of advisors (35%) were bullish on the prospects for gold. The S&P/TSX Capped Gold Index™ delivered a 40.69% return in Q1 while the price of gold bullion was up 16.14%.

“Gold bullion and gold equities were consistently among the worst performing asset classes over the last two years, so it may take more than a quarter of positive returns for the asset class to regain its luster in the eyes of advisors,” said Mr. Hawkins. “Still, the low levels of bullish sentiment are surprising when you factor in the level of returns generated last quarter and the overall deflationary macro-environment globally, including the use of negative interest rates in Europe and Japan. These deflationary factors usually signal a favourable move in gold.”

Canadian advisors remain bullish on U.S. equities, but not to the same extent they were last quarter, when more than 70% of respondents were bullish on the S&P 500® Index in Q1, compared to only 53% being bullish this quarter. Bullish sentiment on the NASDAQ-100® Index also declined to 50% in Q2, down from 68% in Q1.

“The decline in bullish sentiment on U.S. equities is likely a combination of two factors: the strong relative performance of Canadian equities and the rally of the Canadian dollar,” said Mr. Hawkins. “In U.S. dollars, the S&P 500 was up slightly at 0.77%, but hedging for Canadian currency, it declined 5.44%. Not only do investors have to get the directional call right in U.S. equities, but they have to get the currency call right as well.”

Sentiment was very mixed when it came to the Canadian versus U.S. dollar trade. Only 28% of advisors were bullish on the loonie heading into Q1.

“The strength of the loonie is really dependent on the strength of energy prices,” said Mr. Hawkins. “Although the loonie rallied approximately six per cent last quarter, it’s not surprising to see reserved sentiment here since there are a lot of unknowns in terms of energy prices and the direction of interest rates in the U.S., which are probably the two biggest factors in pricing for the loonie.”

For U.S. treasuries, sentiment from advisors was also mixed, with 43% of advisors neutral on the asset class. In U.S. dollar terms, the returns on treasuries were positive last quarter.

“U.S. treasuries are typically a safe-haven for investors, particularly during widespread market turmoil like we saw in mid-January.” said Mr. Hawkins. “The returns of the Canadian dollar versus the U.S. dollar have made investing in this asset class a little trickier for Canadian investors, but if we see volatility return, this might continue to be a strong performing asset class, domestically.”

Q1 2016 was a very volatile one, with the VIX spiking to extreme levels in the first half of the quarter and then declining rapidly in the second half. Sentiment on volatility, as represented by the S&P 500 VIX Short-Term Futures™ Index, was mixed with only 41% of advisors being bullish and a further 31% stating they were neutral on the asset class.

About the Q2 2016 Advisor and Investor Sentiment Surveys
Horizons ETFs conducts the only quarterly sentiment survey of Canadian investment advisors. Both results have been collectively branded under the title ‘Q2 2016 Advisor and Investor Sentiment Surveys.’ The surveys quantitatively measure advisors’ and investors’ quarterly outlooks as it relates to key benchmarks covering equities, bonds, currencies and commodities. For full survey results, visit

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Horizons Announces April 2016 Distributions for its Covered Call ETFs

Horizons ETFs is a Member of Mirae Asset Global Investments. Commissions, trailing commissions, management fees and expenses all may be associated with an investment in exchange traded products managed by AlphaPro Management Inc. and Horizons ETFs Management (Canada) Inc. (the "Horizons Exchange Traded Products"). The Horizons Exchange Traded Products are not guaranteed, their values change frequently and past performance may not be repeated. The prospectus contains important detailed information about the Horizons Exchange Traded Products. Please read the relevant prospectus before investing.

The Horizons Exchange Traded Products consist of the Horizons Index ETFs ("Index ETFs"), Bull Plus and Bear Plus ETFs ("Plus ETFs"), Inverse ETFs ("Inverse ETFs"), VIX ETFs (defined below) and active ETFs. The Plus ETFs and certain other Horizons Exchange Traded Products use leveraged investment techniques that can magnify gains and losses and may result in greater volatility of returns. These Horizons Exchange Traded Products are subject to leverage risk and may be subject to aggressive investment risk and price volatility risk, which, where applicable, are described in their respective prospectuses. Each Plus ETF seeks a return, before fees and expenses, that is either 200% or -200% of the performance of a specified underlying index, commodity or benchmark (the "Target") for a single day. Each Index ETF or Inverse ETF seeks a return that is 100% or - 100%, respectively, of the performance of a Target. Due to the compounding of daily returns, a Plus ETF's or Inverse ETF's returns over periods other than one day will likely differ in amount and possibly direction from the performance of their respective Target(s) for the same period. The Horizons Exchange Traded Products whose Target is the S&P 500 VIX Short-Term Futures Index™ (the "VIX ETFs"), one of which is a Plus ETF and one of which is an Index ETF, as described in their prospectus, are speculative investment tools that are not conventional investments. The VIX ETFs' Target is highly volatile. As a result, the VIX ETFs are not generally viewed as stand-alone long-term investments. Historically, the VIX ETFs' Target has tended to revert to a historical mean. As a result, the performance of the VIX ETFs' Target is expected to be negative over the longer term and neither the VIX ETFs nor their Target are expected to have positive long term performance. Investors should monitor their holdings, as frequently as daily, to ensure that they remain consistent with their investment strategies.

†The indicated rates of return are the historical annual compounded total returns including changes in per unit value and reinvestment of all dividends or distributions and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any securityholder that would have reduced returns. The rates of return shown in the table are not intended to reflect future values of the ETF or returns on investment in the ETF.