Q: I wanted some gold exposure in my TFSA-Any thoughts on GLCC.CA
Also what does the group think of buying CDR'S
Thankyou
Also what does the group think of buying CDR'S
Thankyou
5i Research Answer:
We think GLCC fine for gold investors looking for enhanced income through covered calls. Our only comment really is that when gold runs it often runs hard, and a covered call fund will not perform as well as a straight equity fund in a giant gold rally. But, for those who just want exposure and higher income (indicated yield 10.9%) we have no qualms with it. Fees are a bit on the high side at 0.81% and it has a five-year return of 10.21% annualized. We are totally comfortable with CDRs for investors who want hedged exposure to a select group of US companies. Modeled after American Depository Reciepts, the Canadian version is a convenient way of buying US securities in Canadian funds, with lower price points than a direct investment.