BMO Europe High Dividend Covered Call Hedged to CAD ET (ZWE.TO)

European good quality dividend paying stocks with a covered call overlay. It is a fine way to play in a defensive market. This is the way to do it as they hedge the currency risk out.

Euro. Covered call and hedged to CAD$. This was one of Larry’s ideas. He loves it for the principals.

This gives covered call premiums on top of high dividend paying stocks. You want to be careful of the currency situation, because it is not a hedged strategy. The ETF he likes when entering the European market is the Wisdom Tree European Hedged Equity ETF (HEDJ-N). Doesn’t see anything particularly wrong with this one, but hasn’t had a chance to look at it deeply. The European market is the right place to be for part of your portfolio.

This was his suggestion to BMO as an ETF people would want. He likes the product. It gives you Europe and it gives you yield. He believes this is how you get a higher return in this market for the next year.

This is a Covered Call, which typically gives you a higher dividend payout, because they have the ability to generate more income. Volatility is pretty high right now, typically a good thing when you are in the options market. He tends not to use covered call instruments. The more moving parts that you have in an ETF, the more likely that something is going to go wrong.