Q: Is HDIV a good conservative dividend income investment for long term?
5i Research Answer:
HDIV is a multi-sector covered call fund which uses some leverage (25%) to enhance returns. It is still 100% equity based, so it can decline, but generally we would consider it conservative, though less so because of the leverage. The covered call premiums provide a bit of downside protection, but in a market crash this is still going to decline. But we are comfortable with its strategy overall for those who understand its goals.