@@dmalinowski15 I hold ZDV and ZWU not sure why I didn't go for ZWC but here are am. In 5 months they are up 5% excluding payouts. I also hold ZCN, in the same time it's up 12%. :)
OK, time to look at some cover call etf's now that there is a pullback and your video has convinced me to look into these investment vehicles. Thanks Adriano👍🇨🇦
Clear as daytime. Im in and started! Im already a divi investor so this is just a extra focus. Im now at 250 dollars a month and boosting so total at 1000 US a month building. Love it, have a 6 year strategy for this. Then we will see if im just gonna DRIP or take half out. Im 46 now so time is limited :)
I discovered Covered Call ETF (as well as Split share ETF) in your previous videos and I love it. I own ZWU, ZWC, and CIC. Once understood, these ETF are as safe as standard ETF. Also, I love their MONTHLY dividend distribution.
@@PassiveIncomeInvesting wondering if you'll ever do a video aimed at the retired investor, don't know if your strategy is or isn't feasible for somebody like myself who is 68 and been retired for several years?
My only concern is nav erosion. If at some times me you ever had to sell say TSLY and you bought it at 18 and it is 10 you do not have as much to buy something else. My approach is to use these as a replacement for bonds. I keep what I need for monthly income in covered call etf. Then the other 70% of my portfolio in growth stocks.
I don't know who out there needs to hear this right now but stop doubting yourself. YOU can do it! EdYOUcate yourself and get in the game. Don't let life pass you by and look back with regret! :)
@@cindyjonessherk8985 We only have right now. The best time to plant a tree was 20 years ago, the second best time is now. Good luck and God bless, Cindy! :)
I think what I learned from you videos is: Split share/ income funds have a high yield, but rarely increase or decrease the dividend. They are at high risk of temporarily pausing the monthly dividend payments if nav is too low. Dividend distribution never changes, so little or no protection against 2-3% economic inflation unless you buy new shares at lower prices and/or do drips. Some stocks increase dividend regularly but usually have lower yield than split share/income funds and cc etf's. Stocks are at risk of cutting dividends and pausing their yearly dividend increases. Cover Call Etfs usually pay their dividends, but the amount is unpredictable from month to month with some really high paying months and some that are lower. Total yearly dividend may not increase from year-year and may not outpace 2-3% economic inflation. Is that mostly correct?
What do you mean decades to reach 8-10> yield? If enbridge has a yield of 7.45%, and if they grow their dividend by 10% per year, then next year the yield on original investment will be around 8.19%. then 9.0% the year after.
Great video bro. I’ve been watching your videos and your info has been great for tightening up my dividend part of the portfolio. You should do a podcast! I’ll be the first guy in line! Thanks again!
Good day Adrian - Would collecting these Covered Call ETF's and just dripping them continuously overtime in a continuous cycle have the equivalent effect as if you also invested in growth stocks etc. and much safer obviously in case of crashes etc.
Thanks for the video and updates you provide. Today "Feb 23rd 2021", I finished buying my other half of my RRSP portfolio on this down market and based on your previous video "$250,000 Dividend Portfolios RRSP Unveiled | 2000$/Month" and related spreadsheet which I further enhanced for my use. You (and a few others in financial) also inspired me to start my own YT channel and hopefully to share a story on this sometime later as I get proficient with video editing & storytelling. Thank you and keep up the efforts...I now know the work these videos take to keep everything in line. :)
Each of your videos is classic, and the explanations is clear and easy to understand. i especially like the explanations with subtitles below, thank you Adrian, awesome as always!
Good explanations of these Covered Call ETF's. Now that I'm almost retired (in 1 month), I'm using about 8 of these types of ETF's to generate passive & supplemental income during my retirement and that's being working out really well. Just an idea for another video: with some new Covered Call ETF's out now that are 0DTE (daily options expiration instead of monthly), compare the features of those with what was discussed in this video.
Hello Adrian and thank you so much for this video. I just wanted to ask you or anyone here in the comments. What happens after the call option is "exercised"? Should I buy shares manually? or it's automatically? Will I get a notification if I need to buy in replacement for the sold shares? Thanks a lot again.
Great video, thanks for this. I'm just retiring, I've done well with my portfolio of individual stock but now looking for more security and reliable income. This video is extremely helpful.
This is the first time I see this interesting strategy for the higher dividend. I have a portfolio of Blue Chip companies and have done pretty well over the last 9 years. But is very interesting this new approach. I will research to see if I can invest in equivalent Covered call ETF's here in USA. Thanks for the interesting video. You have a new subscriber her. thumbs up.
Excellent! I discovered covered calls with individual stocks a couple of months ago. Holy Moly! The potential is great! I like doing it myself, BUT, to generate the income I want, covered call ETFs make a lot of sense. Thanks! Liked and subscribed.
Hey Adrian! Thanks for another great video ☺️. Thanks to you I have ZWK in my personal account and it's appreciated 30%, not to mention the monthly dividend. I have ZWC and ZWE in my TFSA and on Monday I'm buying ZWU, ZWG, ZWH and ZWB in my new RRSP portfolio now that I'm officially out of mutual funds. Cheers!! Stay safe.
Thanks for this video! It really helped me understand how these work. I looked into buying QYLD but my brokerage flags it as a high risk investment and wants me to acknowledge a “Designated Investments Agreement” and flag my account as “aggressive”. Should I be concerned?
@@PassiveIncomeInvesting also, I’m curious what you think about USOI. Covered calls on US Oil Funds. 67.98% yield! I’m sure it’s too good to be true but wondering what are the other red flags? Thanks!
Great info Adrian and Erica: quick question, if we compare the original version of the etf to its coverd call version the over all return or the total return is more in the original version. For example: ZEB with Zwb or Zbk with Zwk, or zut with zwu or zdv with zwc.. the original versions perform better than the coverd call version. Could you please respond if that is right? Thank you again
U are awesome. I wish you could some how talk some sense into these other u tubers who continue talking against covered calls as a trap or a tax burden or a instant loss the minute you buy it. There are so many of these dudes saying no that it really makes me research more and every time i look at it more I just like it more
Thank you very much, Adrian! Love all your channels which are the best among others. Seems the covered call etfs are the best choice for passive income investment. Can you tell if it's covered call by its name, or you have to visit its website?
Thanks man ! Usually it’s in the name but not all the Time . The funds website is always best … but in Canada there’s only 6 main providers of cc ETF’s : bmo , ci, harvest , horizons and bronpton
I will have to do more research, but you have helped so much on giving me a big head start and confidence boost in doing investing. I hope you get lots of subscribers and lots of website customers. Thank you!
Thanks for another great video. Even if you don't intend to sell the stocks, the dividend usually stays the same. Compared to an etf/stock that increases it's dividends you will gain less on the long run. If you need the income in 20 years I think it's better to invest in an etf/stock that increases it's dividends.
Excellent video. One interesting exercise would be to compare an index etf + drip vs covered call etf + drip to see which outpaces which over a given time period.
@@PassiveIncomeInvesting That's my instinct too but it would be interesting to quantify it it's true and by how much. Wouldn't it be wild to find out it's net neutral or that some variery of a Covered Call ETF ends up beating the index (however slightly).
Probably not by much … keep in mind I still like to think I own the whole stock market to a certain extent . As I own the funds hold the blue chip leaders in their respective sectors
I like these too, low risk, high income, tough to go wrong especially once you’re retired and even when you’re not so long as you’re dripping. I guess once you’re in retirement mode though you have to keep in mind that if you’re living off all the income, say it’s 8% and not touching you’re capital investments, the investments themselves many not grow since they are more stable. They might not keep up with inflation. So you’re salary that you pay yourself will decrease relative to inflation over time. Best case would be to pay yourself 6% of the 8% and drip the remaining 2%. Do you agree?
In the example with the Bell shares, how much of a premium would you collect? I don't have a good sense for roughly how much profit one makes when they write these covered calls. Great video btw!
@@PassiveIncomeInvesting so I did since googling and I think what you are staying is that the dividend return is paid per share rather than per 'dollar'... Do correct me if I'm wrong. I don't think there is much doubt overall returns are going to lose to portfolios not based on these options, but some people just want to receive a somewhat safe and predictable income and not have to do or think about any of it. Perceived piece of mind at the cost of potential growth. Ironically that's entirely the opposite of the mindset that got me the money to retire early in the first place.
It’s just another way of investing ... they can both work . We’re financially independent and in our mid 30’s so I know it does . And yea dividends are paid out per share
Hi Adrian. The only Canadian banks you have would be in SBC and the percentage that is in ZWC ? You don’t hold ZWB or CIC coward called ETF’s ? Thanks. My covard call ETF’s I hold are ZWC ZWU and HHL in which I added more this month to my original positions.
@@PassiveIncomeInvesting most of your bank investments are split share funds ? I have ZWC and SBC I’ve been looking at ZWB and CIC but can’t decide because I like CIC because the funds look better due to it’s bigger holdings of TD bank and bigger yield but downside is it pays quarterly and the fund is small 1.54 M ZWB pays monthly, yield is less but fund has 1.83B in assets I can’t decide but I’m 75% sure I like CIC better. Adrian do you have a video on your top 3 monthly paying ? And do you think it makes a big difference other then the frequency? Thanks Adrian.
Picked up my first position on Friday SGR. My Reits are IDR SGR REI. I was thinking of selling REI and moving it into SRU for the higher yield any thoughts ?
Great channel love it bro. I have a question please. I can't understand how this fund works. Lets say they write covered calls ATM. If the stock is down 10% a month and a day before the option expires, they have to sell it and write a new option for next month. But they write the new option on a very low strike. So if the stock will go back up next month, so a day before the option's expire, they will have to buy the option for a huge premium.. and that is a loss isn't it?
Thank you so much. I thought calls and outs were more for speculative trading and not for dividend income. I would assume that the ETF fees are much higher as the fund requires much more active management, or not?
Thank for your work on showing how to achieve higher dividend yields. It often seems that these investments trend at, around, or lower over time. Can you share your thoughts on this as a decrease in asset value is a set off to higher yields. Thank you.
Thanks for the great video! I was wondering what would happen to ZWC in the case of a market correction or crash? Would ZWC be a good place to keep my emergency fund or is there still enough risk involved that you would advice against it? thanks again, keep up the great content.
Hi - Awesome video. Question - in a covered call strategy, you can expect around ~8% in cash flow yield but aren't you also gaining from stock price appreciation perhaps not as high as in a regular ETF? Let's say you get ~7% in Capital gains + ~8% in yield you are ultimately receiving ~15% over the long-run. Is this a correct assessment?
Thank you for the great explanation, just wondering why you didn't mention stocks that pay over 12%, does the same principal apply? Something like FFN or similar split shares corp?
Thanks for the info man you're like one of the few actually speaking about this subject im definitely intrigued and ready to start investing. Hey, by any chance can you recommend some of the best CC ETFs for us in the states. Thanks again .
ZWC and other BMO covered calls have a return of capital which is not healthy as this is a portion of your money coming back to you as the distribution. I would rather get the full dividend and the Cdn divy tax credit.
That’s a myth many people unfortunately still believe ... roc is not necessarily bad . Plus it’s not taxed at all . But hey if you want lower yield with higher taxes because you feel roc is bad , go ahead
Another great video - you really help to clarifying things. Can you explain why it's risky to have too much invested in split-share corps. & Income trusts?
Splits perform bad in bear markets as they might miss dividends , but covered call ETF’s can balance that risk out . Ultimately it’s how you define risk and what it means for you .
@@PassiveIncomeInvesting ....I couldn’t find the tax video......however I’ll try again. I have the same question for anything that’s in a foreign country with regards to these call option ETF’s......on holding taxes. I realize on split shares the two components of capital appreciation and dividends are treated differently. It’s just the U.S ETF’s I’m not sure of.
Not sure I understand the question . Cc is an income enhancing strategy on stocks . Nothing to do with preferred shares . Those are just hybrids of stock and bond you can say
Another great video. I don't need my dividends now so it all goes back into the stocks, creating more dividends :) To be honest, I won't "need" the dividends when I retire too but nice to have even more money to leave to the kids, spend on the grandkids if I have any, or do whatever I wish to with it. For me, dividends are extra padding during retirement. I just wish I knew more about such things earlier in life but never too late to start, plus I've started my kids (pre-teens) on this journey as well. PS - Glad to see those subscribers growing!
thanks for another great video!! I was just looking at the covered call etf stocks in your portfolio and was looking into FLI, but nowhere in its factsheet says it is covered call etf... did they change it?
Hey Gordon , no it’s still a cc etf . If click on the insights tab on the funds page , you will see it in that document . The direct link is also on my website under the free tools and resources link . Under ci first asset covered call strategy 😎
Adrian, thank you for all the info. I have a newbie question. For ZWC, it said on the BMO site, under Eligibility, it listes: RRSP/RRIF/RESP/DPSP/TFSA. Does that mean I could not buy it in my cash trading account?
I bought 2 BMO covered call ETF's a while ago, your explanation reaffirms why! Love your channel!
Which ones did you grab? I’m staring at ZWC a lot
@@dmalinowski15 honestly zwc seems too good to be true I bought like 40 shares
Its good and it’s true 😎
@@dmalinowski15 I hold ZDV and ZWU not sure why I didn't go for ZWC but here are am. In 5 months they are up 5% excluding payouts. I also hold ZCN, in the same time it's up 12%. :)
@@s.m4125 all I can say is good move. :)
OK, time to look at some cover call etf's now that there is a pullback and your video has convinced me to look into these investment vehicles. Thanks Adriano👍🇨🇦
Clear as daytime. Im in and started! Im already a divi investor so this is just a extra focus. Im now at 250 dollars a month and boosting so total at 1000 US a month building. Love it, have a 6 year strategy for this. Then we will see if im just gonna DRIP or take half out. Im 46 now so time is limited :)
I discovered Covered Call ETF (as well as Split share ETF) in your previous videos and I love it. I own ZWU, ZWC, and CIC. Once understood, these ETF are as safe as standard ETF. Also, I love their MONTHLY dividend distribution.
Who doesn’t !
@@PassiveIncomeInvesting wondering if you'll ever do a video aimed at the retired investor, don't know if your strategy is or isn't feasible for somebody like myself who is 68 and been retired for several years?
It’s actually best for retirees …
My only concern is nav erosion. If at some times me you ever had to sell say TSLY and you bought it at 18 and it is 10 you do not have as much to buy something else. My approach is to use these as a replacement for bonds.
I keep what I need for monthly income in covered call etf.
Then the other 70% of my portfolio in growth stocks.
I don't know who out there needs to hear this right now but stop doubting yourself. YOU can do it! EdYOUcate yourself and get in the game. Don't let life pass you by and look back with regret! :)
Why is it sooooo hard? Lack of eduction and opportunity to practice. So sad for us all!
Thanks
Lack of education is the big one , why they don’t teach us this stuff in high schools is beyond stupid
@@PassiveIncomeInvesting Appreciate the reply! I totally agree with you, my friend. Have an awesome Friday and weekend! :)
@@cindyjonessherk8985 We only have right now. The best time to plant a tree was 20 years ago, the second best time is now. Good luck and God bless, Cindy! :)
“I enjoy every second of those 6 seconds” 😂
Bro! you hit the ball out of the park with this one! Will be buying my 1st CC ETFs with my next paycheque!
I think what I learned from you videos is:
Split share/ income funds have a high yield, but rarely increase or decrease the dividend. They are at high risk of temporarily pausing the monthly dividend payments if nav is too low. Dividend distribution never changes, so little or no protection against 2-3% economic inflation unless you buy new shares at lower prices and/or do drips.
Some stocks increase dividend regularly but usually have lower yield than split share/income funds and cc etf's. Stocks are at risk of cutting dividends and pausing their yearly dividend increases.
Cover Call Etfs usually pay their dividends, but the amount is unpredictable from month to month with some really high paying months and some that are lower. Total yearly dividend may not increase from year-year and may not outpace 2-3% economic inflation.
Is that mostly correct?
I’m not worried about inflation , do you know long it would take for a dividend stock to raise their dividend enough to reach 8-10> yield ? Decades
What do you mean decades to reach 8-10> yield? If enbridge has a yield of 7.45%, and if they grow their dividend by 10% per year, then next year the yield on original investment will be around 8.19%. then 9.0% the year after.
Awesome video man, thanks for the explanation. A good video for you to do I think would be to show what's in your TFSA :)
For US viewers, RYLD, XYLD, QYLD, USOI, SLVI, GLDI are a few monthly covered call ETF's.
Thanks for this 👍
Thank you so much! This is exactly what I was looking for.
Slvo 😎
Great video Adrian - Why then do you not have or offer a product/ portfolio also - based solely on Covered Call ETF's alone etc. ?
Great video bro. I’ve been watching your videos and your info has been great for tightening up my dividend part of the portfolio. You should do a podcast! I’ll be the first guy in line! Thanks again!
TXF has been killing it for me lately, first and only covered call ETF but looking at more
Well it’s technology so of course it’s been killing ! 😎 great way to get income in tech stocks which is tough to do
I am really thankful I’ve come over your channel, your strategy is exactly what I really love! Thank you.
Good day Adrian - Would collecting these Covered Call ETF's and just dripping them continuously overtime in a continuous cycle have the equivalent effect as if you also invested in growth stocks etc. and much safer obviously in case of crashes etc.
Adrian, thanks for the content as well as your humour!
Thx for the vid. Have ZWC in my portfolio with ZWB, ZWU, ZWK, and ZWS on my watchlist.
So happy to find your channel, life changing, can’t thank you enough, thank you from the bottom of my heart 🙏👍
Thanks man. Been trying to explain this to my dad. Hopefully he can get it from this video!
I want a cow that milks itself and doesn't have to be fed
That sums up entire discussion!
Love your videos
Thanks for the video and updates you provide. Today "Feb 23rd 2021", I finished buying my other half of my RRSP portfolio on this down market and based on your previous video "$250,000 Dividend Portfolios RRSP Unveiled | 2000$/Month" and related spreadsheet which I further enhanced for my use. You (and a few others in financial) also inspired me to start my own YT channel and hopefully to share a story on this sometime later as I get proficient with video editing & storytelling. Thank you and keep up the efforts...I now know the work these videos take to keep everything in line. :)
The best video I have seen on covered call ETF investing. Thanks for sharing.
Thanks for being there. I have learned alot from you, and opened my eyes to dividend investing.
Hi, do the ETF values maintain while providing the income? Tks
Good information videos. My question is when you mention "option premium to be made" at 14:22. Do we see the option premiums made?
Not directly no , they are generated within the etf but this is what a portion of the distributions are made of
@@PassiveIncomeInvesting thank you for your time and quick response.
Thank you. No worries. I have been comverted. Invest for returns, not speculate on increace.
Each of your videos is classic, and the explanations is clear and easy to understand. i especially like the explanations with subtitles below, thank you Adrian, awesome as always!
Good explanations of these Covered Call ETF's. Now that I'm almost retired (in 1 month), I'm using about 8 of these types of ETF's to generate passive & supplemental income during my retirement and that's being working out really well.
Just an idea for another video: with some new Covered Call ETF's out now that are 0DTE (daily options expiration instead of monthly), compare the features of those with what was discussed in this video.
Already done ! Search my newest videos
Can you do a video focusing on best performing US based covered call ETFs?
QYLD
As usual another very good video. Indeed options are not obvious to get (nor to explain) but once you get it, you get it.
Learned a TON!! AMAZING VIDEO.! finally a vid that explains what options are...
thanks!
Great video Adrian. Im with you all the way. My portfolio is 90% covered call etf’s. love the BMO’s
Sleep 💤 well my friend
Great job again!!! I really like this channel. I was wondering what would you suggest as a portfolio mix? Covered Calls, Splits, Growth and income.
verry clear adrian thanks again .i just buy your ultimate passive income ...have a good day buddy
Thanks man let me know what you think ! Please leave a review on my website 🙏
Hey Adrian what do you think of having USOI ETN to portfolio and out of USOI distributions buying SCHD to portfolio
Your Every upload makes me feel closer to freedom.
Hello Adrian and thank you so much for this video. I just wanted to ask you or anyone here in the comments. What happens after the call option is "exercised"? Should I buy shares manually? or it's automatically?
Will I get a notification if I need to buy in replacement for the sold shares? Thanks a lot again.
these are professionally managed my friend. there is nothing to do on your part!
@@PassiveIncomeInvesting Thank you so much my friend. I'm learning a lot from watching your videos. I can't wait to start investing.
Good one. Need a US version 🙂
Great video, thanks for this. I'm just retiring, I've done well with my portfolio of individual stock but now looking for more security and reliable income. This video is extremely helpful.
Great time to switch strategy!
This is the first time I see this interesting strategy for the higher dividend. I have a portfolio of Blue Chip companies and have done pretty well over the last 9 years. But is very interesting this new approach. I will research to see if I can invest in equivalent Covered call ETF's here in USA. Thanks for the interesting video. You have a new subscriber her. thumbs up.
Global x has some great covered calls ETF’s like qyld and Ryld
@@PassiveIncomeInvesting Thanks for you quick response. I will research Global x. Take care and wish you all the best.
Excellent! I discovered covered calls with individual stocks a couple of months ago. Holy Moly! The potential is great! I like doing it myself, BUT, to generate the income I want, covered call ETFs make a lot of sense. Thanks! Liked and subscribed.
I learned so much from this video. Thanks Adrian! 😊
Glad to hear thanks 🙏
Can u choose reinvestment instead of distributed option for this?
Thank you Adrian!!
Thank you…This video explains every question I had about covered call ETFs and more…I plan to invest in them in the future!!!!
Hey Adrian! Thanks for another great video ☺️. Thanks to you I have ZWK in my personal account and it's appreciated 30%, not to mention the monthly dividend. I have ZWC and ZWE in my TFSA and on Monday I'm buying ZWU, ZWG, ZWH and ZWB in my new RRSP portfolio now that I'm officially out of mutual funds. Cheers!! Stay safe.
Good job my man ! For the rrsp don’t forget about qyld ! No 15% tax !!!
I get it. I want to do it. How do I do it? How are the rrsp and tfsa related? Are they related? What are the steps?
Quality as always. Thanks!
Great video you explained options so well!
Thanks very much for the explanation, I now look at passive investment strategy differently. Roughly what % of your portfolio is covered call etfs?
Thanks for this video! It really helped me understand how these work. I looked into buying QYLD but my brokerage flags it as a high risk investment and wants me to acknowledge a “Designated Investments Agreement” and flag my account as “aggressive”. Should I be concerned?
It’s definitely not a high risk investment if you ask me
@@PassiveIncomeInvesting thank you!
@@PassiveIncomeInvesting also, I’m curious what you think about USOI. Covered calls on US Oil Funds. 67.98% yield! I’m sure it’s too good to be true but wondering what are the other red flags? Thanks!
Nah impossible lol I gotta check that one out
I have QYLD in my RRSP and its doin very well for me.
Great info Adrian and Erica: quick question, if we compare the original version of the etf to its coverd call version the over all return or the total return is more in the original version. For example: ZEB with Zwb or Zbk with Zwk, or zut with zwu or zdv with zwc.. the original versions perform better than the coverd call version. Could you please respond if that is right? Thank you again
My next video explains why I don’t care
Awesome video very informative I appreciate the knowledge
U are awesome. I wish you could some how talk some sense into these other u tubers who continue talking against covered calls as a trap or a tax burden or a instant loss the minute you buy it. There are so many of these dudes saying no that it really makes me research more and every time i look at it more I just like it more
Thank you very much, Adrian! Love all your channels which are the best among others. Seems the covered call etfs are the best choice for passive income investment. Can you tell if it's covered call by its name, or you have to visit its website?
Thanks man ! Usually it’s in the name but not all the Time . The funds website is always best … but in Canada there’s only 6 main providers of cc ETF’s : bmo , ci, harvest , horizons and bronpton
Great video as always. Thank you! 👍👍👍👍
Thanks! I think I finally kinda get what a call option is!
thanks. very informative! i have 3 covered call etf in my portfolio. can u do income fund in the future? pros and cons of closed end funds. thx.
Excellent video, it explained so much!
Love the video dude! I was just wondering do you only invest in Canadian stocks (Im still new to this so just trying to understand)
I will have to do more research, but you have helped so much on giving me a big head start and confidence boost in doing investing.
I hope you get lots of subscribers and lots of website customers.
Thank you!
Thanks for another great video.
Even if you don't intend to sell the stocks, the dividend usually stays the same. Compared to an etf/stock that increases it's dividends you will gain less on the long run. If you need the income in 20 years I think it's better to invest in an etf/stock that increases it's dividends.
Excellent video.
One interesting exercise would be to compare an index etf + drip vs covered call etf + drip to see which outpaces which over a given time period.
The index fund will most likely win in the long term ! I admit it . Check out my previous video !😎
@@PassiveIncomeInvesting That's my instinct too but it would be interesting to quantify it it's true and by how much. Wouldn't it be wild to find out it's net neutral or that some variery of a Covered Call ETF ends up beating the index (however slightly).
Probably not by much … keep in mind I still like to think I own the whole stock market to a certain extent . As I own the funds hold the blue chip leaders in their respective sectors
Outstanding video. Two thumbs up.
Hands down best explanation! Keep it up man :)
I like these too, low risk, high income, tough to go wrong especially once you’re retired and even when you’re not so long as you’re dripping. I guess once you’re in retirement mode though you have to keep in mind that if you’re living off all the income, say it’s 8% and not touching you’re capital investments, the investments themselves many not grow since they are more stable. They might not keep up with inflation. So you’re salary that you pay yourself will decrease relative to inflation over time. Best case would be to pay yourself 6% of the 8% and drip the remaining 2%. Do you agree?
Yup I agree that’s why I’m planning to have millions in my rrsp accounts thanks to aggressive compounding interest ! Check out my rrsp video 😎
In the example with the Bell shares, how much of a premium would you collect? I don't have a good sense for roughly how much profit one makes when they write these covered calls. Great video btw!
Not sure either as I never did it myself on single stocks
Hi, If the share is sold (the option exercised) is the proceeds added to our brokerage account? Tks
no that's all within the fund
@@PassiveIncomeInvesting thanks for the reply. But if they exercise the option to purchase , surely I will have less funds left over?
Another super helpful video with valuable info! Thank you.
Great information on this video.
Keep up the great work.
Given you make a one time investment, if the price of the shares fall over time, would your dividen income decrease as well?
Nope ! Not with these funds . They will follow the stock market , they won’t just go down over time . It also depends and varies from fund to fund
@@PassiveIncomeInvesting so I did since googling and I think what you are staying is that the dividend return is paid per share rather than per 'dollar'... Do correct me if I'm wrong.
I don't think there is much doubt overall returns are going to lose to portfolios not based on these options, but some people just want to receive a somewhat safe and predictable income and not have to do or think about any of it. Perceived piece of mind at the cost of potential growth. Ironically that's entirely the opposite of the mindset that got me the money to retire early in the first place.
It’s just another way of investing ... they can both work . We’re financially independent and in our mid 30’s so I know it does . And yea dividends are paid out per share
Hi Adrian. The only Canadian banks you have would be in SBC and the percentage that is in ZWC ? You don’t hold ZWB or CIC coward called ETF’s ? Thanks. My covard call ETF’s I hold are ZWC ZWU and HHL in which I added more this month to my original positions.
I have a crap ton of banks . There in sbc , zwc , ds , ftn , lbs , inc.un , dfn , eit
@@PassiveIncomeInvesting most of your bank investments are split share funds ? I have ZWC and SBC I’ve been looking at ZWB and CIC but can’t decide because I like CIC because the funds look better due to it’s bigger holdings of TD bank and bigger yield but downside is it pays quarterly and the fund is small 1.54 M ZWB pays monthly, yield is less but fund has 1.83B in assets I can’t decide but I’m 75% sure I like CIC better. Adrian do you have a video on your top 3 monthly paying ? And do you think it makes a big difference other then the frequency? Thanks Adrian.
Tomato tomAto 🍅
@@PassiveIncomeInvesting LoL True all the same except CIC pays bigger dividends
Picked up my first position on Friday SGR. My Reits are IDR SGR REI. I was thinking of selling REI and moving it into SRU for the higher yield any thoughts ?
What about the fact that some funds stop their payouts etc. - when it comes to Covered Call ETF's.
Hi Adrian, thanks so much for your videos, you are doing awesome work and very inspiring.
"I want to own a cow that milks itself and does not need to be fed" - awesome
Great channel love it bro.
I have a question please.
I can't understand how this fund works. Lets say they write covered calls ATM. If the stock is down 10% a month and a day before the option expires, they have to sell it and write a new option for next month. But they write the new option on a very low strike. So if the stock will go back up next month, so a day before the option's expire, they will have to buy the option for a huge premium.. and that is a loss isn't it?
Don’t worry bro they're professionals , they know what they’re doing .
Thank you so much. I thought calls and outs were more for speculative trading and not for dividend income. I would assume that the ETF fees are much higher as the fund requires much more active management, or not?
Just a bit … why don’t you check lol it’s right there on the funds website
Watched and liked, thanks!
Would the number of shares in the fund eventually run out?
Thank for your work on showing how to achieve higher dividend yields. It often seems that these investments trend at, around, or lower over time. Can you share your thoughts on this as a decrease in asset value is a set off to higher yields. Thank you.
Love going back over the videos. Learn something new every time. Adriano best investor of all times
I appreciate that!
Great video! Thanks so much man
Thanks for the great video! I was wondering what would happen to ZWC in the case of a market correction or crash? Would ZWC be a good place to keep my emergency fund or is there still enough risk involved that you would advice against it? thanks again, keep up the great content.
It would follow the Canadian stock market basically , look at the chart. Zpw is better for parking money
@@PassiveIncomeInvesting Thanks so much for reply! Great job :)
Hi - Awesome video. Question - in a covered call strategy, you can expect around ~8% in cash flow yield but aren't you also gaining from stock price appreciation perhaps not as high as in a regular ETF? Let's say you get ~7% in Capital gains + ~8% in yield you are ultimately receiving ~15% over the long-run.
Is this a correct assessment?
Correct , they have more yield but less growth , perfect for a buy and hold income investor !
Great Video! What platform are you using for your portfolio?
Td
Hi Adrian, do you know of any emerging market Covered Call ETFs?
Those are rare but there’s some in hej .
Thank you for the great explanation, just wondering why you didn't mention stocks that pay over 12%, does the same principal apply? Something like FFN or similar split shares corp?
Split corps also use the covered call strategy but they are in a class of their own . Got separate videos for those !
Thanks for the info man you're like one of the few actually speaking about this subject im definitely intrigued and ready to start investing. Hey, by any chance can you recommend some of the best CC ETFs for us in the states. Thanks again .
Thanks man , start with the global x ones , qyld , Ryld , SDIV etc
ZWC and other BMO covered calls have a return of capital which is not healthy as this is a portion of your money coming back to you as the distribution. I would rather get the full dividend and the Cdn divy tax credit.
That’s a myth many people unfortunately still believe ... roc is not necessarily bad . Plus it’s not taxed at all . But hey if you want lower yield with higher taxes because you feel roc is bad , go ahead
Great explanation. Thank you
Another great video - you really help to clarifying things.
Can you explain why it's risky to have too much invested in split-share corps. & Income trusts?
Splits perform bad in bear markets as they might miss dividends , but covered call ETF’s can balance that risk out . Ultimately it’s how you define risk and what it means for you .
@@PassiveIncomeInvesting what would you consider as the best percentage of total portfolio for covered call / splits / income trusts / REITs ?
Is there a holding tax on ZWK......since it holds U.S banks......if the ETF is held outside an RSP, example in a non registered account?
No , I explain all that in my tax video , check it out
@@PassiveIncomeInvesting Okay, thank you....will do!
Let me know if it was clear 😎
@@PassiveIncomeInvesting ....I couldn’t find the tax video......however I’ll try again. I have the same question for anything that’s in a foreign country with regards to these call option ETF’s......on holding taxes. I realize on split shares the two components of capital appreciation and dividends are treated differently. It’s just the U.S ETF’s I’m not sure of.
ruclips.net/video/yAz9rK5V7FA/видео.html
Is this similar to common shares vs preferred shares?
Not sure I understand the question . Cc is an income enhancing strategy on stocks . Nothing to do with preferred shares . Those are just hybrids of stock and bond you can say
Thank you for this video, very informative!
Another great video. I don't need my dividends now so it all goes back into the stocks, creating more dividends :) To be honest, I won't "need" the dividends when I retire too but nice to have even more money to leave to the kids, spend on the grandkids if I have any, or do whatever I wish to with it. For me, dividends are extra padding during retirement. I just wish I knew more about such things earlier in life but never too late to start, plus I've started my kids (pre-teens) on this journey as well. PS - Glad to see those subscribers growing!
Could not agree more
thanks for another great video!! I was just looking at the covered call etf stocks in your portfolio and was looking into FLI, but nowhere in its factsheet says it is covered call etf... did they change it?
Hey Gordon , no it’s still a cc etf . If click on the insights tab on the funds page , you will see it in that document . The direct link is also on my website under the free tools and resources link . Under ci first asset covered call strategy 😎
@@PassiveIncomeInvesting ahh thanks!
Adriano, how do you turn on the DRIP's for the Covered Call ETFs?
You need to Call your broker to do it
Watched and liked! Good info......I will start some positions in covered call etf's.
Interesting.. Noob question - Are there similar covered put ETFs too?
Yup , zph , zpay, payf are some
Adrian, thank you for all the info. I have a newbie question. For ZWC, it said on the BMO site, under Eligibility, it listes: RRSP/RRIF/RESP/DPSP/TFSA. Does that mean I could not buy it in my cash trading account?
No no of course you can . Everything is eligible in the cash account !
@@PassiveIncomeInvesting Thank you very much for your quick reply!!