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Recon Capital NASDAQ-100 Covered Call ETF (QYLD)
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Global X S&P 500 Covered Call ETF (XYLD)
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Hamilton Canadian Financials YIELD MAXIMIZER TM ETF (HMAX)
Q: On march 28 question ,I was interested by the topics and by your answer,that seems to consider the 3 ETF in the same category :"HMAX would fit in this category as it does employ a covered call strategy targetting Canadian financials and primarily the 'Big 5' banks. Some covered call ETFs we like are QYLD and XYLD. We also think Hamilton ETFs line of covered call ETFs is solid, although some are very new and small which we would watch out for. ". Personnaly I did not choose QYLD and XYLD since I don't consider them in the same category as HMAX and others ETF as BMO ETF etc.. QYLD exerts options on 100% of its portfolio,wich limits upside and could lead to a significant long term downtrend; this is not the case for HMAX whose options are on 50% of its portfolio and consequently it keeps some upside potential.Is my comprehension OK or Do I miss something?
5i Research Answer:
We agree they are not the same, with different strategies. But, for someone seeking enhanced income they can still all be considered, if an investor understands the strategy. While ETFs using 100% options may underperform in a rally, they will also provide higher income always, so there is an offset here.