BMO Covered Call Utilities ETF (ZWU.TO) Buy,…

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BMO Covered Call Utilities ETF (ZWU.TO)

11.34

-0.02 (0.18%)

as of Sep 4, 2026, 7:59:57 pm Market Open.

403 watching

Investor Insights

Sep 4, 2026, 12:00 am

This summary was created by AI, based on 18 opinions in the last 12 months.

The BMO Covered Call Utilities ETF (ZWU) has garnered mixed reviews from experts, but a general trend toward favoring utility investments is evident. Many analysts appreciate the ETF's diversified exposure to utility stocks, pipelines, and telecommunications in Canada, highlighting its tax-efficient income generation through a covered call strategy. With a yield that ranges from 6% to over 7%, this ETF appeals to income seekers, especially in an environment where interest rates may be stabilizing. However, there are cautionary notes about its sensitivity to interest rates and the potential limitations of the covered call strategy which could cap upside potential. Overall, experts agree it serves well as part of a diversified portfolio, particularly for those looking to allocate profits from more volatile sectors into a relatively stable income-generating vehicle.

Consensus

Positive

Valuation

Fair Value

Similar

CdnUtilities, CU

BUY

If underlying stocks are cutting dividends, then ETF will fall. Not seeing dividends being cut anywhere. Would recommend for a defensive investment.

BUY

Great ETF that has exposure to utilities, telco's and pipelines. Dividend rate sensitive to inflation. High dividend yield at 7%. Basket of Canadian dividend paying companies. Would be good for a portion of the portfolio (not 100%).

COMMENT

What is the tax treatment of this, yield or capital gains? Yes, some will be capital gains, some dividends. Your tax slip will break down the tax categories.

BUY

Includes names in Canada and US. Dividend plus a premium. Pipeline names and telcos. Good ETF from someone who wants a high level of income, though not necessarily for growth. Yield about 7.6%.

BUY

A great strategy for low volatility investors. Any price below ~$12 is a good buying opportunity. High dividend yield, with low risk.

BUY

Great way to get lower volatility and lower risk exposure to markets. Recent weakness due to hit to energy markets. Like it a lot bellow $12.5. Good buying opportunity on this dip.

BUY

Note that these aren't your typical utilities, but also pipelines like TransCanada, BCE and Verizon. Holds defensive, dividend players. Pays a 7.5% dividend yield. Holds safe, low-beta names. Likes it. It has performed well, down less than 1% YTD in today's market.

BUY ON WEAKNESS

Good for dividend portfolio? Love it. Don't own it right now to reduce exposure to energy and pipelines. 13 / 12.5 area really attractive. If you need the dividend, no reason to sell it now.

BUY

Yield is really high, around 7%. Remember that, for utilities, because prices are regulated by government, they can't respond as well to rate increases, and so they tend to underperform markets. When you put a covered call overlay on them, it reduces the upside a bit, but half of it is not covered.

COMMENT

Holds non-traditional utilities like Canadian pipelines, plus BCE and Telus, Verizon, US pipelines. Covered call can boost income up to 7% here. When markets move higher, covered calls lag. Does really well in a flattish market, compared to owning the underlying securities. Good for people who want income, not necessarily looking for the capital gain.

BUY

A way to extract yield from the markets without too much risk. Has always recommended for income.

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Curated by Allan Tong since 2019.
99+ opinions with 4.15 rating.

TOP PICK

The BMO Covered Calls Utilities ETF, pays a big 7.52% dividend and charges a 0.71% MER. The biggest holdings are ZUT, the BMO Equal Weight Utilities ETF, Enbridge, TC Energy, Pembima and Fortis. Those with ESG concerns, take note that these are pipeline names. ZWU also holds telcos, including Rogers, BCE and Telus. Both classes of stocks are solid dividend payers. All Canadian. ZWU is fairly liquid, averaging 377,000 shares daily.

BUY

Utilities, pipelines, telecoms. Very nice dividend of around 7.6% with the covered call. YTD, down only 1.24%, which is not bad. Good name for income, not a ton of capital appreciation.

WAIT

Based on utilities. In a rising rate environment, because they're heavily regulated, they can't just go out and change rates on their own. So these could take a bit of a hit. You might want to wait a couple of weeks to see what the first real interest rate increases are going to be and buying it then. Yield is really good. In general, a good ETF.

BUY ON WEAKNESS

Has traditional utilities, pipeline and telcos. All good dividends with high covered call exposure with a yield of 7%. Would not add here. Wait until it comes down. Some interest rate sensitivity but a solid yielder. Have to be mindful of oil prices for the pipeline and interest rates.

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BMO Covered Call Utilities ETF (ZWU.TO)