Product Insights

Get Paid to Wait BMO Covered Calls ETFs Yielding >6%

Aug. 31, 2022

Attention advisors looking for ideas to enhance their clients’ portfolio yield

As rising inflation continues to spark concern among investors, our covered call ETF strategies offer the ideal solution with strong, stable cash flow and lower volatility. Explore our top exposures as of August 312022:

ZWU BMO Covered Call Utilities ETF
  • Exposure to defensive equity income, with strong fundamentals in the sector going forward
  • Positive returns in 2022 demonstrate defensive characteristics relative to the broad market
ZWG BMO Global High Dividend Covered Call ETF
  • Diversified global exposure to dividend oriented equities that are positioned well fundamentally to perform well in a high inflationary economy
  • Covered calls offer a better risk-adjusted approach to the sector for income-oriented investors given that overall growth expectations remain lower
ZWB BMO Covered Call Canadian Banks ETF
  • Canadian banks are seeing reasonable valuations, including a 4.5% dividend yield, and are somewhat insulated should problems arise in the mortgage market
  • Seasonality could be a tailwind in the second half of the year
  • Also offered in Mutual fund format
ZWC BMO Canadian High Dividend Covered Call ETF
  • Sustained higher energy prices will benefit the Canadian economy overall given natural overweight to the oil and gas sector
  • Dividend-oriented equities are poised to perform well for the remainder of 2022, while high inflation persists
  • Also offered in Mutual fund format
ZWH BMO US High Dividend Covered Call ETF
  • Dividend-oriented equities continue to be well-capitalized and strongly positioned to deliver results amid high inflation
  • The U.S. economy is likely to lead the developed world during a period of economic slowdown backed by high-quality U.S. companies
  • Also offered in Mutual fund format

Contact your BMO Exchange Traded Funds specialist for more information.

*Annualized Distribution Yield as of August 31, 2022. The most recent regular distribution, or expected distribution, (excluding additional year end distributions) annualized for frequency, divided by current NAV.

Source: BMO Global Asset Management.


Any statement that necessarily depends on future events may be a forward-looking statement. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions. Although such statements are based on assumptions that are believed to be reasonable, there can be no assurance that actual results will not differ materially from expectations. Investors are cautioned not to rely unduly on any forward-looking statements. In connection with any forward-looking statements, investors should carefully consider the areas of risk described in the most recent simplified prospectus.

This communication is for information purposes. The information contained herein is not, and should not be construed as, investment, tax or legal advice to any party. Investments should be evaluated relative to the individual’s investment objectives and professional advice should be obtained with respect to any circumstance The payment of distributions is not guaranteed and may fluctuate.

The payment of distributions is not guaranteed and may fluctuate. The payment of distributions should not be confused with an Exchange Traded Fund’s performance, rate of return or yield. If distributions paid by the Exchange Traded Fund are greater than the performance of the Exchange Traded Fund, your original investment will shrink. Distributions paid as a result of capital gains realized by an Exchange Traded Fund, and income and dividends earned by an Exchange Traded Fund are taxable in your hands in the year they are paid. Your adjusted cost base will be reduced by the amount of any returns of capital. If your adjusted cost base goes below zero, you will have to pay capital gains tax on the amount below zero. Please refer to the Exchange Traded Funds, distribution policy in the prospectus.

Commissions, management fees and expenses (if applicable) all may be associated with investments in exchange traded funds. Please read the ETF Facts or prospectus before investing. The indicated rates of return are the historical annual compounded total returns including changes in unit value and reinvestment of all dividends or distributions and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any unitholder that would have reduced returns. Exchange traded funds are not guaranteed, their values change frequently and past performance may not be repeated.

For a summary of the risks of an investment in the BMO ETFs, please see the specific risks set out in the prospectus. BMO ETFs trade like stocks, fluctuate in market value and may trade at a discount to their net asset value, which may increase the risk of loss. Distributions are not guaranteed and are subject to change and/​or elimination.

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