Q: Dear 5i team.
Can I have your updated views on this covered call etf? What % are they writing cov calls on, and what is the projected elasticity of price moves assuming markets up/down 20%
Tanks for your help.
Can I have your updated views on this covered call etf? What % are they writing cov calls on, and what is the projected elasticity of price moves assuming markets up/down 20%
Tanks for your help.
5i Research Answer:
PDIV has 59% of its portfolio covered with call options, and an additional 12% of cash-secured put options. Assets are only $23M, even though it has been around some time. Five year performance is fairly weak at 5.71%, though yield is high at (indicated) 12.11%. We would expect about a 12% +/- move for every 20% market move. With fairly weak long term performance, and its small size, and the fact that its holdings are fairly typical US/Canada large caps, we can't give it a strong endorsement.