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Horizons Equal Weight Canadian Bank Covered Call ETF (BKCC)
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Global X Canadian Oil and Gas Equity Covered Call ETF (ENCC)
Q: Just read an article in the Financial Post recommending these high yielding etfs.It seems to me to be extremely bad advice for your average investor.Your thoughts??
5i Research Answer:
We have multiple comments posted this week on ENCC; BKCC is a covered call bank ETF. There is nothing 'wrong' with covered call funds, for those looking for enhanced income and are willing to give up some capital gains potential. But investors need to understand what they are buying. These are not risk free, and in a bad market losses will likely be more than the yields provided, for a period of time. But for 'part' of an income allocation, these funds have their uses. But any investor expecting 13% yields with no risk needs to reconsider.