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Looking for yield? These ETFs have you covered

Posted on 19 March 2013

To enhance yields, three of the Canada’s seven ETF providers, BMO, Horizons and First Asset, have a specialty group of funds that use covered call writing as a fundamental component of their investment strategy. In total, there are 20 ETFs available in Canada that generate income from option premiums.
These covered call funds focus on equities and commodities, with total assets under management of $1.7-billion. In the right environment, the premiums from writing covered calls can add an extra 50 per cent or more to an ETF’s dividend income. The ideal environment involves high volatility, which results in a higher price for the calls being sold………………………………………..Full Article: Source


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VRS - who has written 37533 posts on Opalesque Commodities Briefing.


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