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Hamilton Canadian Financials YIELD MAXIMIZER TM ETF (HMAX $16.85)
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Hamilton Utilities YIELD MAXIMIZER TM ETF (UMAX $13.26)
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Hamilton Energy YIELD MAXIMIZER TM ETF (EMAX $16.16)
Q: 2:15 PM 5/5/2026
Hello Peter.
I was quite interested to read Joseph's question today, May 5th and to study your answers and recommendations. It brought my attention the Hamilton Covered Call "MAX" ETFs which have attractive yields.
We have owned large positions in Canadian banks and utilities for decades mainly for the divided income but have never ventured to try covered calls on them so I was interested in HMAX and UMAX as a way of easing into this strategy to watch and learn about it without getting into the complexities of trading. We have always been buy-and-hold forever investors.
Questions
1. You said "Our covered call exposure is specifically to add tax-deferred income (ROC distributions)" so could you give some details on just what the distributions are and how they are taxed.... dividends, ROC, other?. Do the dividend incomes on the shares in the funds flow directly to the owner [me] as part of the distributions of the fund shares.
2. I presume that HMAX and UMAX are all Canadian for income tax purposes. Does this apply also to EMAX which is 79.7% in US? I do not want to own US stocks with all the taxation complexities and T1135.
3. Could you suggest a Canadian Covered Call ETF focused just on Canadian pipelines, midstream, and oil and gas production
Thank you........... Paul K.
Hello Peter.
I was quite interested to read Joseph's question today, May 5th and to study your answers and recommendations. It brought my attention the Hamilton Covered Call "MAX" ETFs which have attractive yields.
We have owned large positions in Canadian banks and utilities for decades mainly for the divided income but have never ventured to try covered calls on them so I was interested in HMAX and UMAX as a way of easing into this strategy to watch and learn about it without getting into the complexities of trading. We have always been buy-and-hold forever investors.
Questions
1. You said "Our covered call exposure is specifically to add tax-deferred income (ROC distributions)" so could you give some details on just what the distributions are and how they are taxed.... dividends, ROC, other?. Do the dividend incomes on the shares in the funds flow directly to the owner [me] as part of the distributions of the fund shares.
2. I presume that HMAX and UMAX are all Canadian for income tax purposes. Does this apply also to EMAX which is 79.7% in US? I do not want to own US stocks with all the taxation complexities and T1135.
3. Could you suggest a Canadian Covered Call ETF focused just on Canadian pipelines, midstream, and oil and gas production
Thank you........... Paul K.
5i Research Answer:
With any ETF, income is flowed directly to unitholders and taxed in their hands. Last year 83% of HMAX payouts were ROC. 72% of UMAX was ROC. HMAX is all Canadian. Note UMAX is 8% US. EMAX is 82% US. There will be withholding taxes on US dividends from the latter. But this is only on the US portion, and may be quite low because of the ROC component. 3) There is not a covered call specifically focused on these areas, but we would suggest ENCC here.