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BMO Covered Call Energy ETF (ZWEN $34.61)
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Evolve Canadian Energy Enhanced Yield Index Fund (OILY $11.64)
Q: Hi 5i Team,
Could I please get your current thoughts on the Canadian oil sector? If one doesn't currently have a position in the sector how would you view starting one today?
I'm thinking of starting a position in Oily for an income focused, non-registered account. Besides ENCC are there any alternatives you could point out to me that could be a good fit?
Thanks for the Great Service
Could I please get your current thoughts on the Canadian oil sector? If one doesn't currently have a position in the sector how would you view starting one today?
I'm thinking of starting a position in Oily for an income focused, non-registered account. Besides ENCC are there any alternatives you could point out to me that could be a good fit?
Thanks for the Great Service
5i Research Answer:
We would be fine with some exposure; the sector is very cheap, balance sheets are solid and in better shape than other cyclical periods, and M&A activity is picking up. We are fine with covered call funds such as ENCC, however unless enhanced income is truly desired we would prefer not to limit upside with call options. But with income as a goal, ENCC looks fine. ZWEN can also be suggested. OILY is very small and we would not suggest it.