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Global X S&P/TSX 60 Covered Call ETF (CNCC $13.16)
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Global X S&P 500 Covered Call ETF (USCC $19.69)
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Hamilton Utilities YIELD MAXIMIZER TM ETF (UMAX $13.54)
Q: Hello, I am turning 60 in January, while I still work, I would love to retire in a couple of years, would it be a reasonable portfolio to migrate my portfolio to a more income focused, covered call strategy portfolio, in general terms, I know you cannot get personal. I think the vast majority will be broad based ETFs with maybe 25% using leveraged based ETFs. From what I have seen, the BETA for these funds seems to be a lot less than there non covered call cousins.
5i Research Answer:
Some of the leveraged funds still have a short history but generally we would be comfortable with such a strategy for those that understand the products. There can be some tax advantages if the ETFs' income is a large part return of capital. One needs to accept that in a market rally these could lag a big (the leverage will help, though). Covered call option premiums provide income in both good and bad markets, and this can reduce overall volatility. But investors need to note these are 100% equity-based, and in a steep market correction there will still be losses, perhaps substantial.