To whom it may concern,
Hi, it’s Mark again. I’m a 5i Research member and I have a question similar to ones I’ve asked in the past.
I currently hold a large position in Whitecap Resources for the monthly dividend, but I’m looking for something that is likely a bit safer. You have provided some ETF recommendations to me before, but when I look at the long-term charts (10–15 years), many of those dividend-paying ETFs are trading below where they were back then, which is a bit concerning.
Could you please suggest what you consider to be the safest ETF—either American or Canadian—that I could hold in my TFSA, which pays a monthly dividend roughly comparable to Whitecap?
Thank you very much for your help and your consideration.
Sincerely,
Mark
Keep in mind we would look at total returns (including dividends) and not just price returns. Some ETFs will see price decay but still positive returns when dividends are included. WCP pays monthly with a 6.24% yield. Not that many ETFs pay above 6% monthly and many that do will be covered call ETFs and may experience some price decay. Some suggestions we have , such as HDIV, which has a 3-year total return of 20.69%, use leverage (25%) and this may not be desired. Utilities are generally considered a safe sector, so UMAX (non leveraged) may be an option here, paying monthly at a high rate (YTD total return 10.90%). RCDC also hits the criteria in a diversified fund with a one year return of 14.49%. It is fairly small but has done well and would be big enough for a position to be held (not traded).