Celestica makes high-speed networking hardware for AI data centres. The stock has risen over 260% in a year. Revenue guidance is approaching $17 billion. Google has doubled its capital expenditure and Celestica is a preferred supplier for complex infrastructure builds. The company's entire investment appeal is its upside.
Ninepoint's response is to wrap it in a covered call structure that sells that upside in exchange for monthly income. With genuine care and reasonable financial engineering, they have built a product that takes one of the more spectacular AI infrastructure growth stories and politely caps it.
I am not saying this is wrong. I am saying it is a philosophical position worth noticing.
Constellation Software is one of Canada's most celebrated compounders. It acquires vertical market software businesses, runs them efficiently, and uses the proceeds to acquire more. It currently oversees more than a thousand individual businesses. The stock has spent years trading at multiples that make conventional valuation uncomfortable.
Ninepoint has decided this one company requires two ETFs. The CoreShares variant holds the stock for capital appreciation with monthly distributions. The HighShares variant wraps it in covered calls for enhanced income. Same underlying. Two different answers to the question of what kind of Constellation investor you are.
Both launched on the same morning. The stock is trading well below its all-time highs. I am making no causal connection between these two facts, but I am noting both of them in close proximity.
Gold has been reaching record highs. Kinross Gold has risen considerably from its recent lows, posted record revenue and free cash flow, and is rated a Buy by the substantial majority of analysts currently enthusiastic about the gold trade. The underlying commodity is at historic levels.
Ninepoint's response is to wrap the stock in a covered call structure that systematically sells the future upside for present income. At peak gold enthusiasm. On a miner that has appreciated substantially.
This is a coherent product. It serves investors who want yield rather than upside, and those investors exist in large numbers. I understand this entirely. I am still pausing here for a moment.
The London-listed version of the US AIPO product, bringing European investors exposure to the intersection of AI hardware and power infrastructure. The thesis is not unreasonable: AI data centres consume extraordinary amounts of electricity, the grid was not designed for this, and the companies enabling that buildout are genuinely interesting businesses.
Of the batch, this one requires the least sardonic framing. It exists, it is thematic, it is doing what it says on the label. The name contains the words “AI,” “Power,” “Infrastructure," and “Defiance,” which accounts for four of the more assertively marketed words in contemporary ETF nomenclature, but the underlying logic holds together.
The asset management arm of one of Canada's large insurance groups has listed a Thematic Innovation Class ETF. The ticker is ITIN. The mandate, as described, is “thematic innovation,” which is a category that contains, as far as I can calculate, everything.
In a batch that includes a Celestica income wrapper, a double Constellation Software offering, a gold miner yield product, and an AI and power infrastructure play for the London market, the Thematic Innovation ETF arrives with the serene authority of someone who has decided not to pick a lane.
Every theme. All innovation. No further questions.
There is something almost meditative about it.