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BMO Covered Call Canadian Banks ETF (ZWB)
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BMO Equal Weight Banks Index ETF (ZEB)
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Horizons Equal Weight Canada Banks Index ETF (HEWB)
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RBC Canadian Bank Yield Index ETF (RBNK)
Q: For a long term hold (15 years) in a RESP, would you prefer ZEB or ZWB and provide reasons why. Also any other suggestions would be appreciated.
5i Research Answer:
ZWB is the more conservative option of the two, with more of a focus on income. ZWB will do better in a flat market and decline less in a down market. ZEB is better targeted for a rally and has higher upside potential than ZWB, although it can also see larger drawdowns. We prefer ZEB because of the long-term horizon in which banks have typically performed well which gives ZEB more opportunity for growth. We think ZEB is a good option here, but two similar alternatives could be HEWB and RBNK.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in ZWB.