BMO Covered Call Canadian Banks ETF (ZWB.TO)…

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BMO Covered Call Canadian Banks ETF (ZWB.TO)

31.12

+0.25 (0.81%)

as of Jul 6, 2026, 1:42:55 pm Market Open.

328 watching

Investor Insights

Jul 5, 2026, 12:00 am

This summary was created by AI, based on 8 opinions in the last 12 months.

The BMO Covered Call Canadian Banks ETF (ZWB) has garnered mixed reviews from experts, with some praising its covered call strategy and yield, while others express caution regarding its concentration in the Canadian banking sector and current economic conditions. The ETF has performed well, up approximately 52% over the last year, but is noted to be underperforming relative to the equal-weighted ZEB ETF, which has seen a 63% gain. Experts highlight the defensive nature of the covered call overlay, though it comes with trade-offs in terms of upside potential. They advise against adding new capital at this juncture due to concerns over a potential economic downturn that could impact Canadian banks significantly, suggesting a cautious long-term outlook while emphasizing the importance of diversification with both covered and non-covered call strategies.

Consensus

Cautious

Valuation

Fair Value

Similar

ZEB-T

BUY

This does not sell options against the whole portfolio of stocks. You get the dividends from the bank stocks as well as a regular option writing program on a portion of the portfolio, which should generate about 40 basis points a month. Add the dividends on top of that of about 30 basis points, which he feels is a better return than owning the banks outright.

BUY

Some people assume you get the quoted yield and it really isn’t what you get. There is risk on the downside because of what the underlying securities. They do them out of the money and he does them in the money himself. He uses this in smaller accounts where he doesn’t have the money to do covered calls himself.

COMMENT

Individual banks versus this ETF? If you have a massive portfolio, you could diversify by holding individual banks. As a smaller investor, then this ETF is probably a good way to go. It will give you the diversification and, in this particular case, you will also get the covered call. However, in a very volatile market, it may underperform relative to a plane vanilla benchmark.

COMMENT

Covered Call Cdn Banks ETF. A great niche product for this market. This has a fairly decent yield from dividends and covered call premiums. However, you essentially are selling away a little bit of upside, extra capital gains, from the banks. He would prefer an equal weight ETF bank.

BUY

Horizons Enhanced Income Financials ETF (HEF-T) or BMO Covered Call Cdn Banks ETF (ZWB-T) for a long term investment? Likes them both about equally and they are similar. Enhanced Income Financials if you feel insurance will outperform banks otherwise Covered Call Cdn Banks.

BUY

Likes it. Great for do it yourselfers. Good when you only have a few 10s of thousands of dollars. A very good product.

BUY

Is ok. They are selling the options out of the money and more frequently so you aren't getting the buying protection you would get if you were buying the Royal bank and selling the 6 month option. But does like it.

DON'T BUY

Start to look at the straight banking ETF. Covered call ETF is selling away some of the appreciation. The straight up ETF is doing same as this one right now but will do better going forward.

BUY

Covered Call Cdn Banks ETF. Good asset class. Not sure if this is actively managed or just 6 banks passively managed. Fundamentally looks good. Pays dividends.

BUY

Covered Call Cdn Banks ETF. Caller would like to sell her 2 banks to buy this. This ETF covers the major banks and writes covered calls that are slightly out of the money going out about a month or so. This produces income no matter what the market is doing. This would be a win because you have more than 2 banks and the covered call provides a margin of safety.

COMMENT

Covered Call Cdn Banks ETF. (Caller is 28 and is looking to hold for a long term.) This is a very safe vehicle, but won't have fast growth. Current yield is about 8%. For a 28-year-old he would prefer the Equal Weight Bank ETF (ZEB-T) and average down over time.

BUY

Covered Call Cdn Banks ETF. Good way to play the financial sector in Canada. It gives you all the banks along with the enhanced income of a covered call ETF.

COMMENT

Covered Call Cdn Banks ETF is rather appealing but right now you might just want to be long on the banks and just buy the Equal Weight Bank ETF (ZEB-T).

BUY

Covered Call Cdn Banks ETF. Likes this one and uses it for some of his income portfolios. Very good distribution. With this product, you are buying the banks at a pretty decent price right now. All of the distributions from the premiums are being paid out to the unit owners (also believes they are paying the dividends) so take the distribution and pretend it should be half. Take the other half and either set it aside and buy more units or use a DRIP is available.

BUY

Financials have been hurt this year. Believes the strategy of the ETF is still sound.

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BMO Covered Call Canadian Banks ETF (ZWB.TO)