Investment Q&A

Q: I'd like to assess the following group of ETF's I am considering purchasing from a conservative and safety point of view ...... HYPT has been used as the fixed income part of the portfolio . Please advise if this is appropriate and if not a suitable replacement ? The 5i income portfolio has Canadian preferred, convertible bond, and high yield US bonds for around a 15% weighting as the fixed income section ...... Please give a rating of between one and ten with one being the most " conservative and safe " for the following group of ETF's . I will assign the 5i income portfolio a four just so I can see how my choices rank against it using the criteria I suggested ...... Also everything I have chosen is a Hamilton product. Does 5i consider that problematic ? Thanks for your terrific service .....

FMAX 10%
HMAX 10%
QMAX 20%
HYPT 15%
SMAX 20%
LMAX 10%
HYLD 10%
HDIV 5%

Q: Thanks for all you do do us little guys and gals. I would be interested if you know of a good ETF for income with a 5% + dividend with significant US exposure BUT bought in CAD$? If not any US company stocks with a 5%+ dividend that I can buy on the TSX? Thanks again. Dan

Q: Retiring income investor. Do you have a preference between ZWH and HYLD? HYLD has a significantly higher yield but not sure if I'm missing something as far as risk/stability or fees. Also, would you have a concern holding both VFV for growth as well as HYLD for income?

Q: I own a considerable amount of HYLD, but question the use of 25% leverage. I am considering switching to SMAX, but am wondering if they are so similar, that it is not worth switching.
Could you offer me your opinion on which one you would prefer for an income orientated senior investor.

Q: Can you explain, in simple terms, how these 2 ETF’s are soon to have a management fee of 0% .
Is it something unique to these 2 products or could it occur on others having the same properties ? Thanks. Derek.

Q: Can you please provide some comments about the following very high yield ETFs: HYLD.TO, JEPI and JEPQ? The yields seem extremely high and I wonder about the risks associated with these ETFs. Thanks!

Q: Did you happen to read the article in today's Globe & Mail "Don’t be seduced by the juicy yields of covered calls " by Dan Hallett?

I have recently invested in HDIV and HYLD just for those juicy yields produced by the covered call stratagey. Now I am second guessing this idea tempting as the yields are.

What are your thoughts?

Thank you as always for your input.

David

Q: Hi, I am just starting my retirement and I want to get more income from my portfolio. Does it make sense to sell my riocan shares and buy hyld ? My gains in riocan is 30% so I will have to pay taxes on the gain. Thanks

Q: Your thoughts on these funds from Hamilton. Would be for an income portfolio. HYLD in an RRSP which will transition to a RRIF in next few years. HDIV would be held in a non-registered acct.
Yield is attractive but are they sustainable? Is a fund of fund and fees for Hamilton are stacked on top of fees for underlying ETFs.

Q: Hello
There are Youtube Investment Advisors pushing the theme of income investing. Nothing else matters, just the income. Not taxation nor ETF price action (Capital Value).

Given this ETF Theme of Covered Call Strategy (some leveraged 25%) are paying such a high distribution, in the right set of market events (down excessive period) can this strategy trade itself to zero?

They are certainly not making 15% income from dividends and call writing. So capital erosion must be the outcome in today's market.

I was holding covered call etfs from BMO during Covid crash. The strategy performed worse, even after distributions, than straight equity holdings. It was a terrible experience as there was zero downside protection and the strategy seemed to accentuate the drawdown.

Given the current environment (more downside in my opinion) are these ETFs setting investors up for an ugly awakening? ( distribution cuts, return of capital (One's own money), price decline and slowness to recover when markets come back)

Thoughts

Q: I hold riocan for income and some growth and I am up at 30% so far. For more income, do you think it is a good idea to sell and buy the hamilton enhanced us covered call ETF ( HYLD.TO ) that has a dividend of 13% at the moment ? Advise me if you have a better suggestion or simply do nothing and keep riocan. BTW it is in a taxable account so I have to pay taxes on the move. Thanks and have a nice day.

Q: Does the posted yield of about 13% include the .65% management or should .65 be deducted from 13 to reflect the actual yield.
What is your "ballpark guess" as to the percentages of dividends, capital gains and return of capital.
What is the % of U.S. withholding tax. Is it just on dividends or capital gains and roc as well.
Thanks so much

Q: I am a vlaue investor, 76 years old, good pension. 43 stocks, 16 ETF's including the above covered call ETF's. I do have some growth holdings (IWO, LNF, WSP).All are doing well except ZIM and SYZ (not worried). My question is the covered call holdings are 10% of my portfolio. Is 10% too much? I do enjoy the $650 a month dividends which have been consistent for the past five months.
Thank you
Stanley

Q: Hi, I own some HYLD and see that it has dropped more than 10% over the last 2 weeks. It now yields over 13% based on the last payout. Do you think the payout is safe given it's holdings? Also, Would this be a good time to average down? Thanks.

Q: is there a $CDN equivalent to XYLD?

Q: I am wondering about the Hamilton ETF offerings and if they may offer a benefit when markets ever "turn the corner". I know it is impossible to time the markets. Could you comment on these few points:
- Will these slightly leveraged products provide extra torque over the base holdings, dollar for dollar, when markets are rising?
- Is slow buying a reasonable option or with leveraged products do we need to look for a clear bottom and changing market sentiment so the leverage doesn't also leverage any ongoing declines?
- Do covered call products provide any downside protection when markets are well off of a growth phase and could slide further?

Thank you!

Q: Do you know if there is a ROC which is included in the yield?

Thks

Q: Hi, could you tell me why this Covered call ETF would not be availed to purchase as a Market Order, it says it's only available for Limit orders or Stop order, thanks?

Q: Hello 5i
I hold the above covdered call ETF's as well as at least two individual companies from each (from before I bought these). also have over 10 ETF's that are not cover call. I have 51 positions with 49 stocks. These have performed well during this period of unrest. No they do not hit the high notes but not even close to bottom notes either but steadil;y increase in value aside from the dividends. My question is: with these new covered call ETF's at 12% of my investing portfolio (not including GIC's) might this be considered too much? Each is between 1.5% and 2% of the portfolio as are most of my holdings. The dividends are great and have kept up for the last three months. These also hold great companies that I would hold if I had room (and funds to buy them!) as a value investor. Please take as many credits as required.
Thank you
Stanley

Q: A while ago I asked 5I to run the numbers on HCAL as an example of one of Hamilton's new leveraged ETF's comparing both a covered call and similar market ETF and speculate on the return of their other ones ...... Below in quotations is the answer I got .....

" HCAL 1 month 1.7%, three months 0.85%, YTD 34.9%

ZWB 0.9%, 1.65%, 23.7%

ZEB 1.05%, 1.72%, 29.9%

The difference is likely very closely related to the leverage impact. We would not expect HDIV to be different. " .....

Clearly the Hamilton product out performed both the covered call and regular banking market ETF's

Please clarify the following answer given to Craig this morning ? .....

" For a long-term hold, we would side with either VUN or ZWH, as HYLD would cap long-term capital gains due ot the coverd call strategy. We would be fine with the prospects of both ZWH and VUN but side with VUN for a broader exposure to higher growth areas. "