Larry Berman CFA, CMT, CTA BMO Premium Yield ETF ZPAY-T COMMENT Jun 07, 2021

Good way to add diversification for a retiree. Gives you some US exposure to big banks and tech, and with a lower risk profile.

Gives you broad exposure beyond just the financial sector, with about half the risk of the US equity market. Very tax-efficient. Nice yield in the 6% range.

The version that gives you exposure in USD has given you a stronger return in past years. He prefers /F, the one that gives you the hedge.

It is a covered call strategy on U.S. stocks. It is good going forward and holds U.S. large cap companies. You need to understand the downside risk of covered call ETF's.

Really only in the US, in the Innovators series, but only in USD, which is risky now. ZPAY-F gives you exposure to the US, but with the currency hedge, which he prefers. Buffers limit upside, but protect in the downside. It's like a 60/40 balance portfolio and it's tax efficient.

He uses it a lot. It writes puts on stocks to buy lower and sells calls. It pays a 6% yield. If the market slides, this will fall at half the rate of the market, and if the market rallies, this will rise at half the rate, but yet get tax-efficient income off US stocks. But this is not immune to market volatility.

He helped developed this ETF 5 years ago. He uses it. It targets 50% position in a long in a covered call + 50% holds a T-bill and sells puts to generate income. This yields 6%, and has half the volatility of the US stock market. Is tax efficient, because the dividends off the options are treated as capital gains. 

He helped developed this ETF 5 years ago. He uses it. It targets 50% position in a long in a covered call + 50% holds a T-bill and sells puts to generate income. This yields 6%, and has half the volatility of the US stock market. Is tax efficient, because the dividends off the options are treated as capital gains. 

Gives exposure to the US with a lot less risk and tax-efficient distribution though it's market risk, not the safer money-market risk.

Put-write covered call strategy, very tax-efficient yield strategy (though that doesn't matter in a TFSA). You'll have about half the risk of the S&P 500. If your house purchase is in the next year, then no. Not something you put your safe $$ in to use as a deposit for a house a year from now. If that purchase is 5-10 years down the road, then he likes it a lot. 

It's still equity risk, even though it's less risk with a higher yield.