E284 – Understanding Long-Short Strategies

BMO ETFs: Views from the Desk

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8d ago 16:49

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What exactly are long-shorts? And how do they differ from traditional ETFs? In this episode, special guest Lu Lin and host, Erika Toth, delve into the popular alternative strategy, answering frequently asked questions on benefits, portfolio construction, and more.

Erika Toth is Director, Institutional & Advisory at BMO Global Asset Management (BMO GAM). Lu Lin is Head of Quantitative Investments at BMO GAM. Recorded live on Oct 1, 2025.

ETFs mentioned in the podcast:

ZLSU, total returns as of 2025/08/31: 1 yr: 18.00%, SI: 22.53%ZLSC, total returns as of 2025/08/31: 1 yr: 13.25%, SI: 20.61%

ZLSU & ZLSC Inception date: Sep 27, 2023ZSP, total returns as of 2025/08/31: 1 yr: 17.79%, 3 yr: 20.93%, 5 yr: 15.56%, 10 yr: 14.67%

ZCN, total returns as of 2025/08/31: 1 yr: 25.76%, 3 yr: 17.40%, 5 yr: 14.92%, 10 yr: 10.79%

Beta: A measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole. Usually, the market has a beta of 1.0. Stocks with betas higher than 1.0 are interpreted as more volatile than the market, and stocks with betas lower than 1.0 are interpretedas less volatile than the market.

Risk: All investments involve risk. The value of an ETF can go down as well as up and you could lose money. The risk of an ETF is rated based on the volatility of the ETF’s returns using the standardized risk classification methodology mandated by the Canadian Securities Administrators. Historical volatility doesn’t tell you how volatile an ETF will be in the future. An ETF with a risk rating of “low” can still lose money. For more information about the risk rating and specific risks that can affect an ETF’s returns, see the BMO ETFs’ prospectus.

Sharpe Ratio: A risk-adjusted return measure calculated by using standard deviation and excess return to determine reward per unit of risk. The higher the Sharpe Ratio, the better the portfolio's historical risk-adjusted performance.

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This podcast is for information purposes. The viewpoints expressed by the speakers represent their assessment of the markets at the time of publication. Those views are subject to change without notice at any time. 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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