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Harvest US Bank Leaders Income ETF (HUBL $13.94)
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Hamilton Enhanced U.S. Covered Call ETF (HYLD $13.89)
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Hamilton U.S. Financials YIELD MAXIMIZER TM ETF (FMAX $18.81)
Q: I have small holdings in HYLD (1.54), FMAX (2.24) and HUBL (1.51) for 5.29% in my overall US Financial portfolio. I would like to consolidate into only one ETF. I am leaning toward HYLD. Would you have any thoughts on this?. Your comments please. At my age, I am only investing for Dividends, Distributions and Interest. Thank You.
5i Research Answer:
We would be comfortable wit HYLD as a single holding for higher yield and potential, but ONLY if an investor is familiar with, and comfortable with, leverage. The ETF uses 25% leverage, so in a bad market things will be worse than the other ETFs. But, over time, leverage can certainly improve returns. The yield helps offset risk a bit, and its 3-year annualized return is acceptable at 9.70%. Note there will likely be some asset value decay because of the high yield.