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

BMO Covered Call Utilities ETF (ZWU.TO)

11.00

-0.01 (0.09%)

as of Oct 15, 2026, 2:10:48 pm Market Open.

403 watching

BUY

Loves the holding for investors seeking attractive yield on a diversified basis. It does have some risk like exposure to the pipelines. There are telcos and utilities as well in the ETF. A great diversified holding. As interest rates stay low, it can provide good yield with less volatility than the broader market.

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BUY ON WEAKNESS

He hasn't added to his position, but for yield players, it is at an attractive level. This is one of his top pick of the week.

BUY

He likes the US dollar exposure. Overall, he is negative on the market in general. Balancing that with the government action, we probably won't get a sharp sell-off. He is positive on the defensive nature and the higher yield.

DON'T BUY

Looking for yield? He does not really like this one. Utilities, as a group are good. Covered calls are good, when used opportunistically. He likes calls as a tactical tool instead.

HOLD

You will own Canadian utility companies, while they right covered calls. If you think the market is going sideways, it would be a good play. He likes the dividends utilities spit out. Yield 7.8%

PAST TOP PICK

(A Top Pick Apr 02/19, Down 8%) He sold out of this one a while ago. Covered call strategies are good in flat to rising markets, not so much during down turns.

WATCH

There is more volatility to come. The government of Canada wants to minimize the energy industry. There is a serious push for climate change. You'll get a lot more support in the US than in Canada, but you have to consider the tax implications if it is a cash account instead of a registered account. The current situation will require cuts from every nation.

HOLD

With volatility higher now, you get more premium when you write covered calls. After major market declines, you don't get the same bounce back with the covered call overlay. He has not added it recently. He prefers ZUT-T or stay with ZWU-T for the yield.

DON'T BUY

This covered call utility ETF holds a portfolio of utility stocks that sells call options. This caps the upside for any potential recovery. Even with the premiums and dividends collected it has lagged a typical utility ETF. You end up taking 90% of the downside but only 50% of the upside. In a sideways market it can enhance your returns, but lags other in a bull market. He would pass on this one.

PARTIAL BUY

The pipeline component is probably the most volatile. The dividend comes from the option premium and the utilities. It is probably at a point where you can put a half to a third of the money you are thinking of to work.

BUY ON WEAKNESS

The corona virus could make for a couple of ugly quarters globally. Global growth is downgraded to basically zero. We saw a trading dip to $13 below which he suggested in the past you get into this but he would be looking below $13 now and have some patience here.

COMMENT

A US ETF in infrastructure or utilities? Can't think of an infrastructure one, but ZWU holds Canadian as well as American utilities.

WAIT

Covered call Utilities, pipelines and telcos. It has not gone up and he has not sold it, but it could pull back 10% in a broad market correction. ZPAY-T combined with ZWU-T would give a nice diversified exposure. He would wait for pullbacks to deploy new money.

DON'T BUY

He wouldn't buy this now. It's up over 20%. He doesn't like covered calls usually. Chasing dividends could mean that you are taking on underlying risk. It's probably too late to enter.

WATCH

He loves the dividend and the strategy. He is the biggest holder of this fund by a long shot. Around $14 he finds he does not love it for capital growth. If we get a pull back then he would go for it.

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BMO Covered Call Utilities ETF (ZWU.TO)