Why a Covered Call ETF Strategy Is KILLING Your Investment Returns 🤦‍♂️

If you've been investing in covered call ETFs recently, it's very likely you've been giving up returns when compared to non covered call counterparts. It's very important you don't get tunnel vision when it comes to dividends and instead focus on overall returns.

In this video, we're going to go over why a covered call strategy is not optimal in a bull market, show you 3 key covered call ETFs that have underperformed their non covered call counterparts, and let you know who these covered call ETFs may be right for.
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If you're new the channel, Daniel Kent has over a decade of self-directed investment experience and has completed the Canadian Securities Course. He is an avid investor in small-cap Canadian growth stocks and Canadian dividend growth stocks.

Mathieu Litalien holds an MBA, and is a self directed investor with over 20 years of experience investing in the Canadian and US markets. He is also an avid small-cap Canadian growth investor and DGI investor.

Covered call ETFs are a very popular option for many investors. This is because they provide higher distributions, typically on a monthly basis. However, many investors don't know how these exchange traded funds operate, and as a result end up underperforming when it comes to their overall returns.

Covered call ETFs utilize a covered call strategy, which includes selling options contracts that depend on stock prices not accelerating in order to benefit from the premium paid to them for selling the contract. The issue with covered calls in the market environment in the last decade, is that they tend to perform poorly in a bull market.

In this video, we'll go over all of this, and compare these ETFs to other non covered call options.

What an options contract is:

https://www.investopedia.com/terms/o/optionscontract.asp

Why a Covered Call ETF Strategy Is KILLING Your Investment Returns Chapters:

00:00 - Introduction
00:52 - What Is a Covered Call
04:15 - Why Covered Call ETFs Have Underperformed
05:57 - Canadian Covered Call Banking ETF ZWB
08:34 - Canadian Covered Call Utilities ETF ZWU
11:42 - High Dividend Growth Covered Call ETF ZWC
13:30 - Who These Covered Call ETFs Are Suited For
13:59 - Do Not Get Yield Tunnel Vision With Covered Call Strategies
14:36 - When A Covered Call ETF Will Likely Outperform
15:36 - Wrapping It Up

Видео Why a Covered Call ETF Strategy Is KILLING Your Investment Returns 🤦‍♂️ канала Stocktrades