CI Marret’s $0.072 Dividend: A Currency-Hedged Oasis in a Volatile World

In an era defined by geopolitical tensions, central bank rate hikes, and market whiplash, income investors face a stark dilemma: how to secure steady yields without exposing themselves to currency volatility or interest rate risk. Enter the CI Marret Alternative Enhanced Yield Fund (CMEY), whose recent $0.072-per-unit dividend—paid consistently in both March and May 2025—serves as a bold signal of its ability to generate stable returns through a mix of currency-hedged strategies and alternative asset allocation. For investors seeking to mitigate risk while capitalizing on rising rate trends, this fund is emerging as a must-have defensive yield play.

The Dividend: A Mirror of Resilience

The fund’s $0.072 dividend, paid in CAD and USD-denominated series (CMEY.U), is no accident. It reflects a disciplined strategy of currency-hedged income generation, particularly in a market where traditional fixed-income instruments are struggling to keep pace with inflation. By leveraging derivatives, short selling, and geographic diversification, the fund isolates credit risk while shielding investors from currency fluctuations—a critical edge in 2025’s turbulent landscape.

Take its April 2025 portfolio snapshot:
- USD 2-year Treasury futures (9.41% of assets) and Canadian government bond futures (12.22% of assets) act as dual hedges against interest rate and currency volatility.
- Short positions in government bonds (e.g., -11.85% in Canadian government securities) allow the fund to capitalize on declining bond prices as rates rise, turning volatility into an income engine.
- A 29.8% allocation to top holdings, including corporate debt and ETFs like the iShares High Yield Bond ETF, adds yield-enhancing flexibility.

Why USD Hedging Matters Now

In a world where the USD/CAD exchange rate has swung wildly due to divergent monetary policies, the fund’s focus on currency-neutral strategies is a game-changer. For instance, its USD-denominated series (CMEY.U) locks in dollar-based distributions, shielding investors from Canadian dollar weakness—a critical defense as the Federal Reserve and Bank of Canada diverge on rate hikes.

The fund’s use of derivatives isn’t just about hedging—it’s about profiting from uncertainty. By shorting government bonds, it bets against declining bond prices as rates rise, while futures contracts provide downside protection. This dual approach ensures that even in a high-rate environment, the fund can deliver consistent cash flows, making it a counter-cyclical anchor for income portfolios.

A Portfolio Play for Defensive Yield Hunters

Here’s why the CI Marret Fund belongs in your portfolio today:
1. Stable Distributions in Chaos: The May dividend mirrors March’s payout, proving the fund’s ability to deliver steady income even as markets gyrate.
2. Low Volatility, High Conviction: With a stated goal of positive returns over any 12-month period, the fund targets returns exceeding risk-free assets while keeping volatility muted—a rare combination in 2025’s “high beta” world.
3. Currency Hedge as a Safety Net: For Canadian investors, the USD-denominated series acts as a natural hedge against CAD depreciation, while global investors gain exposure to North American credit markets without currency exposure.

Risks? Yes. But Manageable.

Critics will point to the fund’s use of derivatives and short selling, which can amplify losses in extreme market conditions. However, the fund’s 10-year risk rating, derived from historical volatility metrics, underscores its institutional-grade risk management. And with CI Financial Corp. ($546 billion AUM) as its parent, the fund benefits from robust infrastructure and due diligence—key advantages in turbulent times.

Act Now: The Clock is Ticking

The CI Marret Alternative Enhanced Yield Fund isn’t just a dividend machine—it’s a strategic allocation for income investors who refuse to compromise on yield or safety. With rates likely to stay elevated and currency wars heating up, this fund’s blend of currency hedging, alternative credit strategies, and resilient distributions makes it a no-brainer for portfolios seeking to:
- Generate income in a low-yield world.
- Mitigate currency risk without sacrificing growth.
- Stay ahead of market volatility through active management.

Final Verdict: A Must-Have Defensive Asset

The $0.072 dividend isn’t just a payout—it’s a confidence signal. In an era where stability is scarce, the CI Marret Fund offers a rare blend of yield, hedging, and institutional heft. For income investors unwilling to gamble on volatile markets, this is your opportunity to lock in currency-protected returns while positioning for the next leg of the rate cycle.

Act now—before the next storm hits.

This article is for informational purposes only and should not be construed as personalized investment advice. Always conduct thorough due diligence and consult a financial advisor before making investment decisions.