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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: I'm interested in investing in several ETFs that use the covered call strategy to protect from downside pressure on their prices. I'm attracted to the high monthly distributions that some of them pay. Understanding there are disadvantage to this strategy if the market. turns up, please suggest 4 or 5 ETFs that you believe have a good chance of holding their value or increasing it while maintaining their distributions going forward.
Read Answer Asked by Les on May 17, 2023
Q: Hello 5i team,
I'm thinking of increasing my position in ZWU in my TFSA. It pays a big distribution of 8.39% at the moment, and is trading near its 5 and 10 year lows. As utilities have been beat down by rising rates over the past year, would you expect a recovery in the unit price as central banks reach their "terminal rates" and look towards reducing rates in 2024? My understanding is that calls are not written on all of the fund's holdings, leading me to think there is some upside in the unit price if/when utilities recover, in addition to collecting an outsized yield. Is my thesis correct?
Thank you!
Read Answer Asked by Brian on May 17, 2023
Q: An anecdotal comment and a question.

1) When you recommended ECN as part of the portfolio I purchased EFN instead, a fat finger mistake. Unfort when I realized the 'mistake' I made I sold me EFN and bought ECN. A mistake I wished I hadn't corrected.

2)An analyst I follow, with a 65% success rate (wished I was that good) made this recco this am.:

"TD Securities analyst Mario Mendonca downgraded ECN Capital Corp. (ECN:CN) (OTC: ECNCF) from Buy to Hold with a price target of Cdn$0.00..."

I have seen your comments on ECN this am. Its performance has been abysmal ever since it was added to the port, how strongly do you feel ECN will survive and not hit 0?

Sheldon
Read Answer Asked by Sheldon on May 17, 2023
Q: Hi There!

I have read your comments this morning on ECN. it looks like the root cause of their troubles is the inflationary times, Marine/RV/Mobile home financing originations are shrinking considerably etc. I’m a long time holder who is breaking even at these levels. The position is a small part of a diversified portfolio (about 1.5% presently). Do you think it’s worth waiting for the “strategic evaluation” or should one just call it a day and SELL? Otherwise I think it’s a long wait for anything positive to happen here?
Read Answer Asked by Robert on May 16, 2023
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