English – Page 13

Investment objective

XYLD is a passive index ETF that uses a covered call strategy to enhance yield and lower volatility. The fund was created by Global X and tracks the S&P500. The manager follows a “covered call” or “buy-write” strategy, in which the Fund buys the stocks in the S&P 500 Index and “writes” or “sells” corresponding call options on the same index. So far, XYLD has paid monthly distributions 9 years running.

Updated daily – XYLD ETF

Covered call ETF usually protect against downside risk. This being said, the covered call strategy provides limited downside protection. Also, when you write a covered call, you give up some of the stock’s potential gains. Covered call ETFs will tend to have a higher yield and a lower performance (in bull markets) than the portfolio they track.

Is XYLD a good investment?

Positives

Attractive yield thanks to money earned issuing call options;
Lower volatility than investing in the S&P500 ETF such as SPY;
Suits conservative investors and income seekers;
High volatility usually increases the premiums earned by the fund;
Saves you time and effort (if you were youself intesreted on writing call options in the S&P 500
Liquidity: the fund has over 6 Billion dollars assets under management
XYLD is a diversified inevestment

Volatility comparison: XYLD has a lower volatility than the S&P 500 (source of graphic: portfoliolabs.com)

Negatives

Poor performance. You are essentially giving up on the upside potentiel of the S&P 500
The strategy of covered calls becomes ineffective in an unpredictable market

Performance comparison XYLD vs SPY

Updated daily

Distributions

Distribution Yield	12.11%
Distribution Frequency	Monthly

Is XYLD Sustainable? What is the risk of QYLD?

In my opinion, the dividend are not sustainable for one obvious reason: the primary source of dividend with QYLD is options’ premiums. Options by nature are volatile and their value depend greatly on market sentiment.

Is XYLD a monthly dividend ETF

Yes, QYLD offers a monthly dividend distribution.

XYLD ETF Holdings

Net Assets (%)	Name
6.09	APPLE INC
5.65	MICROSOFT CORP
2.35	AMAZON.COM INC
1.77	BERKSHIRE HATH-B
1.66	ALPHABET INC-CL A
1.60	UNITEDHEALTH GROUP INC
1.49	JOHNSON & JOHNSON
1.48	ALPHABET INC-CL C
1.44	EXXON MOBIL CORP
1.26	JPMORGAN CHASE & CO

Why covered call ETFs are popular?

Covered call ETFs are very popular with American investors. Some of these ETFs managers have billions of dollars under management. Two reasons push investors towards covered call ETFs:

High dividend yield: thanks to the premiums earned when writing call options, the manager under certain conditions can earn premiums and enhance distributions;

Low volatility. Writing a call option is a conservative strategy aimed at reducing volatility;

Great for passive income: if you’re main objective is to achieve high dividend yields and build passive income, then covered call ETFs are a good option. But, remember the high dividend yield comes at a price which very low growth potential.

Practice example: covered call strategy

An investor has 100 shares of Company A in his portfolio. Company A’s share is worth $ 30. He anticipates a stagnation or a slight drop in its price and he is ready to sell them at the price of 26 $. He decides to sell a call with the following characteristics:

• Exercise price: $ 26; Maturity: April; Option price: $ 4; Quantity: 100

He collects the following amount: 4 x 100 or 400 $ (premium)

Two cases should be distinguished:

CASE 1

Company A’s share price rose above the breakeven point of $ 30.

Break-even point = exercise price + premium = 26 + 4 = 30

The buyer of the option will choose to exercise his right to buy and, as the seller of the call, the seller will have to sell the shares at the strike price.

During this operation:

the seller sold his shares for $ 26, which constitutes an acceptable loss for him.
the seller collected the amount of the premium of $ 4, which helped boost the performance of his investments (yield).

CASE 2

Company A’s share price has fallen below the breakeven point of $ 30.

The buyer of the option will choose not to exercise his right to buy and the seller will not have to sell his shares.

Thanks to this operation, the seller keeps his shares in the portfolio and he collected the amount of the premium which generated an additional return.

In the world of exchange-traded funds (ETFs), one innovative offering has been generating significant buzz – the YieldMax™ TSLA Option Income Strategy ETF, known by its ticker symbol TSLY. This actively managed fund has a unique approach to generating income for investors by selling call options specifically on Tesla Inc. (TSLA). While the prospect of substantial dividend yields ranging from 30% to 70% may sound appealing, a closer look reveals significant risks associated with TSLY ETF that may make it less suitable for most investors. In this article, we will delve into TSLY’s strategy, its appeal, and why it might not be the right choice for everyone.

Understanding TSLY’s Investment Strategy

TSLY’s primary objective is to generate monthly income through an innovative investment strategy. Its core approach involves selling or writing call options on shares of Tesla Inc. (TSLA). However, what sets TSLY apart from other covered call ETFs is its exclusive focus on TSLA.

The fund’s strategy essentially mirrors being long on Tesla. It achieves this by purchasing at-the-money (ATM) call options while simultaneously selling an equivalent number of ATM put options, both with the same expiration date. These positions typically have terms ranging from six months to one year. This combination creates a return profile similar to owning Tesla stock directly.

To further enhance its income generation, TSLY sells an equal amount of call options that are generally 5% to 15% out-of-the-money (OTM), and typically with expirations of one month or less. The proceeds from these options are distributed to shareholders, resulting in an eye-catching distribution yield of approximately 39.5%. The yield is annualized based on the latest dividend payment.

Additionally, TSLY manages its collateral by holding short-term U.S. Treasuries, which currently generate cash flow for the fund.

JEPI vs JEPQ: Which ETF is the Best Investment for You?

What’s a covered call ETF?

Analyzing TSLY’s Risk Factors

While the lure of high dividend yields may make TSLY seem like a tempting investment opportunity, it’s crucial to consider the significant risks associated with this ETF.

Volatility and Sensitivity to Tesla’s Performance:

TSLY’s strategy is closely tied to the performance of Tesla Inc., a company known for its extreme stock price volatility. This high sensitivity to Tesla’s stock price means that TSLY can experience substantial fluctuations in its share price. Investors should be prepared for the potential for both significant gains and losses.

Limited Upside Potential:

One of Tesla’s key selling points for investors has been its potential for substantial capital gains. However, TSLY’s strategy, designed to maximize income through options, limits its participation in any significant price gains of Tesla stock. This means that investors in TSLY may miss out on the full benefits of Tesla’s stock appreciation.

Market Conditions:

TSLY’s strategy does not include taking defensive positions, even during adverse market conditions. This lack of flexibility can expose investors to heightened risks during market downturns or economic crises, potentially leading to significant losses.

Distribution Cuts and Capital Erosion:

TSLY has experienced distribution cuts and capital erosion since its inception. This trend may continue as it relies on the premiums collected from selling call options to sustain its high distribution yield. Such a strategy may not be sustainable in the long run, putting shareholder income at risk.

Source: Seeking alpha

Comparative Analysis:

When comparing TSLY to more conventional covered call ETFs like XYLD, it becomes apparent that TSLY’s characteristics are more pronounced, primarily due to Tesla’s extreme volatility. For the average retiree or income-focused investor, the risk-reward tradeoff of TSLY may not be as appealing as that of a broader-market ETF.

Should You Consider Investing in TSLY ETF?

While there is no inherent flaw in TSLY’s strategy, its suitability depends on an investor’s risk tolerance, investment goals, and understanding of the underlying risks. Here are some factors to consider when deciding whether to invest in TSLY:

Risk Tolerance:

TSLY is inherently risky due to its direct exposure to Tesla’s stock price and its focus on options trading. Investors with a low risk tolerance may find TSLY’s volatility and potential for losses unsuitable for their portfolios.

Investment Goals:

If your primary objective is to generate high income through dividends, TSLY may seem attractive. However, if you also seek capital appreciation or have a long-term investment horizon, TSLY’s limited upside potential may not align with your goals.

Diversification:

Diversification is a fundamental principle of risk management in investing. TSLY’s concentrated exposure to a single stock, Tesla, can lead to higher risks. Consider how this ETF fits into your broader investment strategy and whether it complements or detracts from your overall portfolio diversification.

Market Conditions:

Be aware that TSLY’s performance is highly contingent on market sentiment towards Tesla. If you believe that Tesla’s stock is poised for significant gains, a direct investment in TSLA may offer better returns without the limitations imposed by TSLY’s strategy.

TSLY Dividends

Amount	Dividend Type	Ex-Div Date	Record Date	Pay Date	Declare Date

0.4046	Regular	2/7/2024	2/8/2024	2/9/2024	12/14/2023
0.5565	Regular	1/5/2024	1/8/2024	1/9/2024	12/14/2023

0.6039	Regular	12/7/2023	12/8/2023	12/13/2023	1/25/2023
0.5846	Regular	11/8/2023	11/9/2023	11/16/2023	1/25/2023
0.5769	Regular	10/6/2023	10/10/2023	10/16/2023	1/25/2023
0.5849	Regular	9/8/2023	9/11/2023	9/18/2023	1/25/2023

Conclusion

The YieldMax TSLA Option Income Strategy ETF (TSLY) offers an intriguing approach to income generation through selling call options on Tesla Inc. (TSLA). However, its unique strategy comes with a set of substantial risks that may not be suitable for all investors. While TSLY can generate impressive dividend yields, its sensitivity to Tesla’s stock price, limited upside potential, and exposure to market conditions make it a risky proposition. This is true particularly for retirees or those seeking long-term capital appreciation.

Investors considering TSLY should carefully assess their risk tolerance, investment goals, and portfolio diversification needs before deciding whether to include this ETF in their investment strategy. For those who prioritize income generation and are comfortable with the inherent risks, TSLY may have a place in their portfolios. However, prudent investors should approach TSLY with caution and a full understanding of the potential rewards and pitfalls it presents.

When exploring Canadian ETF options, two popular choices are the iShares S&P/TSX 60 Index ETF (XIU) and the Vanguard FTSE Canada Index ETF (VCE). Both offer exposure to Canadian equities but have differences worth noting. Let’s dive into a comparison based on fees, size, and holdings – XIU vs VCE.

Executive summary XIU vs VCE

Comparison Aspect	XIU ETF Details	VCE ETF Details
Performance
YTD Return	0.50%	0.61%
3-Year Avg Return	10.54%	11.46%
5-Year Avg Return	9.77%	10.33%
Fees (MER)	0.20% ($200 fee on a $100,000 investment)	0.06% ($60 fee on a $100,000 investment)
Size (AUM)	Over $10 billion (High liquidity)	$1.23 billion (Sufficient liquidity, but less than XIU)
Top Holdings	Royal Bank of Canada, Toronto Dominion, Shopify, Enbridge, etc.	Royal Bank of Canada, Toronto-Dominion Bank, Shopify, Enbridge, etc.
Sector Allocation	Financials: 34.36%, Energy: 17.17%, Technology: 10.29%	Financials: 40.51%, Energy: 16.94%, Technology: 9.36%
Number of Holdings	60 stocks	51 stocks
Index Tracked	S&P/TSX 60 Index	FTSE Canada Index

Performance comparison

Fees: The Cost of Investing

The management expense ratio (MER) is a critical factor in choosing an ETF. It’s the annual fee deducted from the ETF’s net asset value (NAV), affecting your returns. XIU’s MER is 0.20%, meaning a $100,000 investment incurs a $200 annual fee. VCE, on the other hand, boasts a lower MER of 0.06%, resulting in just a $60 fee on the same investment. For cost-conscious investors, VCE emerges as the more economical option.

Size: A Measure of Popularity and Liquidity

Size and liquidity are crucial when considering ETF investments, as they can significantly influence your trading experience and investment security. The size of an ETF, often represented by its assets under management (AUM), can give us a good indication of its popularity among investors. A larger AUM generally means more investors are involved, contributing to higher trading volumes. This, in turn, enhances liquidity, making it easier for you to buy or sell shares of the ETF without causing significant price movements.

Taking XIU as an example, its AUM stands at a bit over $10 billion, positioning it as one of the larger ETFs in the Canadian market. This substantial size suggests not only its popularity but also implies high liquidity. High liquidity is beneficial as it means you can expect tighter bid-ask spreads, which reduces the cost of trading in and out of the ETF.

On the other hand, VCE, with an AUM of $1.23 billion, is smaller compared to XIU. Despite its smaller size, VCE still maintains sufficient liquidity for most investors, making it a viable option for those looking to diversify their portfolios. However, it’s worth noting that smaller ETFs like VCE, while still liquid, might not match the liquidity levels of their larger counterparts, which could lead to wider bid-ask spreads and potentially higher trading costs in certain situations.

Holdings: The Backbone of Your Investment

Both XIU and VCE heavily invest in the financial and energy sectors, reflecting the Canadian market’s composition. Their top 10 holdings include major companies like Royal Bank and Enbridge, underlining their similar investment focus. However, the ETFs track different indexes—XIU follows the S&P/TSX 60 Index, while VCE tracks the FTSE Canada Index. This leads to slight variations in their portfolios; XIU holds 60 stocks, and VCE has 51. These differences might be minor but could influence performance over time.

Sector allocation comparison XIU vs VCE

Sector	VCE Allocation	XIU Allocation
Financials	40.51%	34.36%
Energy	16.94%	17.17%
Technology	9.36%	10.29%
Materials	8.56%	8.49%
Industrials	8.53%	12.73%

XIU Holding details

Ticker	Name	Weight (%)
RY	ROYAL BANK OF CANADA	7.51
TD	TORONTO DOMINION	6.09
SHOP	SHOPIFY SUBORDINATE VOTING INC CLA	5.29
ENB	ENBRIDGE INC	4.14
CP	CANADIAN PACIFIC KANSAS CITY LTD	4.12
CNR	CANADIAN NATIONAL RAILWAY	3.97
CNQ	CANADIAN NATURAL RESOURCES LTD	3.81
BMO	BANK OF MONTREAL	3.73
BN	BROOKFIELD CORP CLASS A	3.11
BNS	BANK OF NOVA SCOTIA	3.09

VCN Holdings

VCN Holding details

Holding Name	% of Market Value
Royal Bank of Canada	8.2%
Toronto-Dominion Bank	6.79%
Shopify Inc.	5.19%
Enbridge Inc.	4.4%
Canadian Pacific Kansas City Ltd.	4.25%
Canadian National Railway Co.	4.23%
Bank of Montreal	4.12%
Canadian Natural Resources Ltd.	4.05%
Brookfield Corp.	3.48%
Bank of Nova Scotia	3.39%

Portfolio Building: How XIU and VCE Fit In

Incorporating XIU or VCE into your investment portfolio can enhance its diversification, especially if you’re looking to have a strong foundation in Canadian equities. Here’s how they might fit into different investment strategies:

For Conservative Investors: XIU, with its focus on the largest and often most stable companies, might be more appealing. Its larger AUM could also be seen as a sign of stability and liquidity.

For Cost-Sensitive Investors: VCE’s lower MER makes it an attractive option for those looking to minimize fees. Over time, the savings on fees can compound, potentially leading to better net returns.

For Broad Market Exposure: Investors seeking a slightly broader exposure to the Canadian market might lean towards VCE, despite its exclusion of some companies, as it still offers a wide view of the market’s top players.

Conclusion

Choosing between XIU and VCE comes down to what you value most in an ETF. If lower fees are your priority, VCE is the clear choice. However, if you prefer an ETF with a larger AUM, XIU might be more appealing. Despite their differences, both ETFs offer a solid foundation for investors looking to tap into the Canadian market. Remember, the best choice depends on your individual financial goals and preferences.

In this post, we will go over the Best S&P500 ETFs in Canada. We selected only highly popular ETFs with a minimum asset under management of 1 Billion dollars. First things first, we will go over some definitions and the pro and cons of holding index ETFs.

What’s an ETF?

refer to our previous post: Everything you need to know about ETFs

What’s an Index ETF

There are several types of ETFs. And, index ETFs are the king of the hill. In fact, the first ever ETF introduced to a North American Exchange was an index ETF. Index ETFs offer exposure to a large number of securities and sometimes to a whole stock exchange at a very low cost. Their main goal is to acquire, on your behalf, all the securities that constitute a specific index in order to achieve the same return of the tracked index minus the fees.

Does Index funds pay dividend?

Yes they do. Since Index ETFs holds all shares of companies part of the index, if these companies pay dividends then a dividend will be distributed. See below the performance table, the dividend yield is included.

8 Best Canadian dividend stocks near their 52 weeks low

15 Best Monthly Dividend Stocks in Canada for passive income

Popular US indexes

S&P 500 Index

The S&P 500 Index, or the Standard & Poor’s 500 Index, is a market-capitalization-weighted index of the 500 largest publicly-traded companies in the U.S.

The S&P 500 is an excellent index because most of its constituents are large established US corporations. It’s well diversified across various sectors of the US economy. The index is widely regarded as the best gauge of large-cap U.S. equities. It can be easily used to express an opinion on the US economy in general. In other words, if you are bullish on the performance of the American economy in the long term, it’s probably the best index for you.

All ETF’s tracking the S&P 500 index will try replicate the index so their holdings will be similar to the table shown below.

Constituents of the S&P 500 index:

Company	Weight (%)
Apple Inc.	5.72
Microsoft Corporation	5.25
Amazon.com Inc.	3.98
Facebook Inc. Class A	2.11
Alphabet Inc. Class A	1.84
Alphabet Inc. Class C	1.78
Tesla Inc	1.52
Berkshire Hathaway Inc. Class B	1.45
JPMorgan Chase & Co.	1.43
Johnson & Johnson	1.27

S&P 500 website

S&P 500 Sector Weighting

Information technology: 27.60%
Health care: 13.44%
Consumer discretionary: 12.70%
Communication services: 10.79%
Financials: 10.34%
Industrials: 8.47%
Consumer staples: 6.55%
Utilities: 2.73%

Nasdaq 100

The Nasdaq-100 is one of the world’s preeminent large-cap growth indexes. It includes 100 of the largest domestic and international non-financial companies listed on the Nasdaq Stock Market based on market capitalization.

This index is dominated by companies in the Information Technology sector.

Company	Weight
Apple Inc	10.971
Microsoft Corp	9.462
Amazon.com Inc	8.433
Tesla Inc	4.236
Facebook Inc	3.801
Alphabet Inc	3.645
Alphabet Inc	3.32
NVIDIA Corp	2.64
PayPal Holdings Inc	2.342
Intel Corp	2.147

As of March 15th, 2020 Source: Investopedia

Nasdaq 100 Sector weighting

Sector	Weight (%)
Information Technology	48.39%
consumer services	19.43%
health care	10.21%
financials	7.21%
industrials	6.85%
consumer goods	5.51%
utilities	0.81%
telecommunications	0.72%
oil and gas	0.55%
basis materials	0.32%

As of March 15th, 2020 Source: Investopedia

S&P 500 vs Nasdaq 100

S&P 500 is more representative of the US economy. It’s more diversified that the Nasdaq 100 which is heavily tilted towards the tech sector. For a long term investor, an S&P 500 ETF is certainly a cost effective option to both diversify one’s investment and get great return overtime. It’s by far the most used Benchmark, meaning most portfolio managers’ mandate is to beat the S&P 500 Index. And, most of them aren’t able to achieve that target!

We discussed the advantages of owning an S&P 500 Index, now time to tackle its drawbacks. The S&P 500 as its the case of most indexes can be volatile. When a manager is in charge, he can try to mitigate risk during tough times but with an index fund there is no one in charge. You are at the mercy of capital markets. If you can weather storms and stay put you should be able to achieve great long term results. Here is a look at the annualized average returns of the S&P 500 for the period ending June 30, 2019:

S&P500 Historical performance

Market index	S&P 500
1-year return	3.40%
15-year average	8.37%
10-year average	10.90%
15-year average	6.75%

As of the end of September 2019

The businesses that make up the S&P 500 index are a blend of large cap that can be either categorized as Growth or Value stocks. So, by investing in this Index, you will have no exposure to mid or small caps. In addition, If you’re seeking a dividend income, there is definitely other ETFs that can better respond to your needs.

What’s the Nasdaq100?

The Nasdaq 100 Index is a basket of the 100 largest, most actively traded U.S companies listed on the Nasdaq stock exchange. The index itself is not representative of the US economy rather a great way to get exposure to one of the most dynamic and innovative sector (Information Technology). What’s particular for the Nasdaq 100 is that it has no exposure to the US financial sector.

“The index leans heavy towards innovative companies that have become our ‘modern-day industrials,’ and accelerated by the pandemic, they play an even greater role in our daily lives. These include names like Apple, Alphabet and Amazon, as well as Netflix, Zoom and DocuSign. Biotech companies, including vaccine maker Moderna, are also well-represented,” According to Nasdaq website’s.

Annual performance of Nasdaq 100

Year	Annual performance
2020	48.88%
2019	39.46%
2018	0.04%
2017	32.99%
2016	7.27%
2015	9.75%

Comparison of the best S&P 500 ETFs (MER, Yield, Fund size and Beta)

Now that we are done with the definitions, below are the Best Canadian Index ETFs list. We will focus in our comparison on the largest ETFs in Canada in terms of the Asset Under Management.

ETFs tracking the S&P 500	MER
BMO S&P 500 Hedged to CAD Index –ZUE	0.09%
Horizons S&P 500 Index – HXS	0.10%
Horizons S&P 500 Index USD – HXS.U	0.10%
iShares Core S&P 500 Index – XUS	0.10%
iShares Core S&P 500 Index (CAD-Hedged) – XSP	0.10%
iShares Core S&P 500 Index USD – XUS.U	0.10%
Vanguard S&P 500 Index – VFV	0.09%
Vanguard S&P 500 Index (CAD-hedged) – VSP	0.09%

Best S&P500 ETF Canada

Comments:
The MER is almost the same for all the selected ETFs above;
ZUE has the highest dividend yield;
XSP is by far the most popular fund in terms of Asset under management. This provides high liquidity for this ETF;
XUS and XUS.U have the lowest volatility. Hedged ETFs have high volatility but also high returns in comparison to Non Hedged ETFs.

Comparison: S&P 500 Index ETFs (Performance)

ETFs that are US denominated (XUS.U, HXS.U ) or CAD Hedged (VSP, ZUE, XSP) have outperformed this past year non Hedged ETFs (HXS, VFV, HXS);
Long term 5 years: the performance of the selected ETFs is within the same range;

Comparison of Nasdaq ETFs (MER, Yield, Fund size and Beta)

ETFs tracking the Nasdaq	MER
BMO Nasdaq 100 Equity Hedged to CAD Index – ZQQ	0.39%
iShares NASDAQ 100 Index ETF (Hedged) – XQQ	0.39%

MER is identical for these two popular ETFs;
The volatility is similar since both are tracking the same index and they are both Hedged.

Comparison: Nasdaq Index ETFs (Performance)

Name	1 Y (%)	3 Y (%)	5 Y (%)
ZQQ	-20.23	14.04	17.37
XQQ	-20.17	14.10	17.48

Source: Yahoo finance – as of July 11th – Total monthly returns

Disclaimer

The data on this website is for your information only. It does not constitute investment advice, or advice on tax or legal matters. Any information provided on this website does not constitute investment advice or investment recommendation nor does it constitute an offer to buy or sell or a solicitation of an offer to buy or sell shares or units in any of the investment funds or other financial instruments described on this website. Should you have any doubts about the meaning of the information provided herein, please contact your financial advisor or any other independent professional advisor.

For this post, we will share the list of Canadian Dividend Stocks under 10$! All these stocks are Canadian companies listed on the TSX. Monthly dividend stocks are a great way to generate a regular passive income.

We limited ourselves to stocks with over five hundred millions market cap to avoid stocks with low liquidity. In addition, only stock with Dividend Payout Ratio under 125% were considered. For each company, we will provide the dividend yield, pertinent ratios and historical performance.

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US Stocks that pay monthly dividends (Full list by sector)

How to select monthly dividend stocks?

Look at the payout ratio

The dividend payout ratio is the amount of dividend distributed by a company divided by the total earnings. For example, a company makes a profit of $ 100 and pays $ 40 in dividends. Its payout ratio is 40%.

If the ratio is high, the company pays almost all of its profits in dividends. There will be little money left in the coffers to innovate or expand to new markets;

It is preferable to invest in a company where the dividend payout ratio is low or medium. The reasoning is that these companies will have money set aside to invest in new projects and thus create growth;

Another variation of payout ratio (Trailing div / Earnings) is the payout ratio to cash (Div / Free cash flows). Earnings can be easily manipulated, so analysts use the payout ratio to cash to assess the safety of dividends better. The website ‘Marketbeat‘ provides the payout ratio to cash for Canadian stocks.

Focus on total return

When one wishes to invest in a dividend-paying stock, it is essential to pay attention to its performance and growth potential. The most common mistake is to invest in stocks with high dividend yields. This strategy is risky. Here’s why :

• A stock can pay a high dividend yield, but is it sustainable? Some companies have a payout ratio that is close to and even exceeds 100%. They manage to post desirable dividend yields, but if we look at the growth prospects, it’s almost nil;

• Investors sometimes shun companies for lack of growth potential or actual risk of lower revenues in the future. These companies experience a drop in the price of their shares, and this causes the dividend yield to become abnormally high. Sooner or later, these businesses will have to cut their dividend.

Dividend sustainability

I personally use the measures below to evaluate a company’s ability to sustain its dividends:

– Debt to Equity ratio: It’s the total debt of a company on shareholders equity. Companies with level of debt are forced to priories the payment of interest charges. This comes at the expense of creating value for shareholders, whether it’s through dividend payment or growth.

– Interest coverage ratio: It’s simply total earnings divided by interest charges. If the ratio is, for example, 4, we would say the company’s earning cover 4 times the interest charges. Business with low interest coverage ratio are at risk. Low ratio means the company’s debt is starting to take a toll on its earnings.

Canadian Dividend Stocks under 10$ -Full list

Last price and Dividend yield

TICKER	PRICE Below 10	DIV YIELD	MKT CAP
FSZFIERA CAPITAL CORP	6.13CAD	14.45%	613.024MCAD
TALPETROTAL CORP	0.74CAD	13.51%	678.915MCAD
TFTIMBERCREEK FINANCIAL CORP	6.60CAD	10.63%	540.89MCAD
BIRBIRCHCLIFF ENERGY LTD.	7.93CAD	10.13%	2.104BCAD
CJCARDINAL ENERGY LTD	7.74CAD	9.60%	1.189BCAD
FCFIRM CAPITAL MORTGAGE INV. CORP.	9.88CAD	9.54%	338.322MCAD
DIVDDIVERSIFIED RTY CORP	2.57CAD	9.34%	368.186MCAD
PNEPINE CLIFF ENERGY LTD	1.52CAD	8.66%	533.615MCAD
PHXPHX ENERGY SERVICES CORP.	7.62CAD	8.00%	371.718MCAD
EXEEXTENDICARE INC	6.12CAD	7.74%	522.53MCAD
DBMDOMAN BUILDING MATERIALS GROUP LTD	7.41CAD	7.50%	650.077MCAD
AQNALGONQUIN POWER AND UTILITIES CORP.	7.57CAD	7.48%	5.393BCAD
INEINNERGEX RENEWABLE ENERGY INC.	9.61CAD	7.48%	1.967BCAD
ECORECORA RESOURCES PLC	1.65CAD	7.30%	409.115MCAD
AFMALPHAMIN RESOURCES CORP.	0.89CAD	6.74%	1.135BCAD
RAY.BSTINGRAY GROUP INC VARIABLE SV	4.50CAD	6.73%	312.886MCAD
RSIROGERS SUGAR INC	5.36CAD	6.65%	567.231MCAD
RAY.ASTINGRAY GROUP INC SV	4.58CAD	6.64%	312.886MCAD
AGF.BDAGF MANAGEMENT LTD	6.86CAD	6.45%	441.595MCAD
AGF.BAGF MANAGEMENT LTD., CL.B, NV	6.84CAD	6.45%	441.595MCAD
DXTDEXTERRA GROUP INC	5.82CAD	6.04%	376.07MCAD
SSFCSAGICOR FINANCIAL COMPANY LTD	5.27CAD	5.73%	750.057MCAD

Dividend Sustainability ratios

TICKER	DEBT/EQUITY	CURRENT RATIO	P/E
FSZFIERA CAPITAL CORP	2.77	—	36.55
TALPETROTAL CORP	0.08	2.90	4.84
TFTIMBERCREEK FINANCIAL CORP	1.53	—	8.85
BIRBIRCHCLIFF ENERGY LTD.	0.13	0.99	6.95
CJCARDINAL ENERGY LTD	0.06	0.69	6.47
FCFIRM CAPITAL MORTGAGE INV. CORP.	0.51	—	10.51
DIVDIVERSIFIED ROYALTY CORP	0.86	5.27	20.24
PNEPINE CLIFF ENERGY LTD	0.03	2.05	11.41
PHXPHX ENERGY SERVICES CORP.	0.34	2.10	5.34
EXEEXTENDICARE INC	4.37	0.78	15300.00
DBMDOMAN BUILDING MATERIALS GROUP LTD	1.28	3.19	10.73
AQNALGONQUIN POWER AND UTILITIES CORP.	1.56	0.71	—
INEINNERGEX RENEWABLE ENERGY INC.	4.89	0.99	—
ECORECORA RESOURCES PLC	0.10	0.49	—
AFMALPHAMIN RESOURCES CORP.	0.12	2.19	14.29
RAY.BSTINGRAY GROUP INC VARIABLE SV	1.43	1.09	8.99
RSIROGERS SUGAR INC	1.52	1.70	—
RSIDROGERS SUGAR INC	1.52	1.70	—
RAY.ADSTINGRAY GROUP INC	1.43	1.09	9.21
RAY.ASTINGRAY GROUP INC SV	1.43	1.09	9.15
AGF.BAGF MANAGEMENT LTD., CL.B, NV	0.08	—	4.97
DXTDDEXTERRA GROUP INC	0.54	1.44	24.96
SSFCSAGICOR FINANCIAL COMPANY LTD	1.46	0.14	6.41

Historical performance

TICKER	3-MONTH PERF	YTD PERF	5Y PERF
FSZFIERA CAPITAL CORP	−8.92%	−30.10%	−50.96%
TALPETROTAL CORP	2.78%	7.25%	146.67%
TFTIMBERCREEK FINANCIAL CORP	−12.23%	−8.21%	−28.57%
BIRBIRCHCLIFF ENERGY LTD.	3.66%	−13.90%	65.21%
CJCARDINAL ENERGY LTD	8.86%	3.06%	79.17%
FCFIRM CAPITAL MORTGAGE INV. CORP.	−6.79%	−8.01%	−23.88%
DIVDIVERSIFIED ROYALTY CORP	−11.11%	−14.95%	−9.86%
PNEPINE CLIFF ENERGY LTD	−1.94%	−8.43%	406.67%
PHXPHX ENERGY SERVICES CORP.	7.93%	2.56%	154.85%
EXEEXTENDICARE INC	−17.41%	−7.55%	−16.73%
DBMDOMAN BUILDING MATERIALS GROUP LTD	16.33%	26.24%	−17.30%
AQNALGONQUIN POWER AND UTILITIES CORP.	−29.78%	−14.94%	−41.14%
INEINNERGEX RENEWABLE ENERGY INC.	−26.25%	−41.62%	−19.72%
ECORECORA RESOURCES PLC	−17.50%	−30.38%	−60.53%
AFMALPHAMIN RESOURCES CORP.	−13.59%	−1.11%	256.00%
RAY.BSTINGRAY GROUP INC VARIABLE SV	−19.35%	−10.00%	−46.43%
RSIROGERS SUGAR INC	−6.29%	−5.47%	−1.83%
RAY.ASTINGRAY GROUP INC SV	−11.92%	−4.58%	−45.61%
RAY.ADSTINGRAY GROUP INC	−13.67%	−5.53%	−45.44%
AGF.BAGF MANAGEMENT LTD., CL.B, NV	−12.76%	−5.13%	21.93%
DXTDEXTERRA GROUP INC	4.68%	11.92%	−58.87%
SSFCSAGICOR FINANCIAL COMPANY LTD	18.43%	−4.53%	−46.71%

The Vanguard US Total Market ETF is a popular index fund. It’s ideal for investors who are looking for a low fee exposure to the US Market. In this post, we will discuss VUN’s strategy, dividend yield and stock performance. We will also compare VUN to VFV and VTI.

Best Dividend Contenders by sector (High Dividend Yields)

CIBC Investor’s Edge Review – Cashback offer

What’s the objective of VUN ETF?

VUN seeks to track the performance of a broad U.S. equity index that measures the investment returns of primarily large-capitalization. In other words, this fund is a way to obtain exposure to the US economy. Since, the index covers a large number of equities, it’s pretty representative.

You would want to acquire this funds for two reasons:

You are bullish on the US economy in general;
to diversify your existing Canadian portfolio of investments with a US component.

VUN managers follow a passive strategy. Meaning, the managers are simply replicating the performance of an existing index. All the details regarding the index, being tracked, are discussed in the section below.

What’s the US Total market index?

The US Total Market Index is managed by the Center for Research in Security Prices. The index includes nearly 4,000 constituents. So, when you’re buying VUN you will achieve, before fees and expenses, the performance of a large basket of US equities. The index includes:

large, mid, small and micro capitalizations. Large caps represent 70% of the overall portfolio;
value and growth stocks, consequently it’s diversified across investment styles.

The methodology used by the index to select constituents can be found below:

when selecting constituents, emphasis is placed on minimizing unnecessary index turnover;
the index is reconstituted quarterly;
market cap of constituents is float adjusted.

VUN dividend yield and historical performance

Table 1: AUM and MER

ETF	AUM*	MER*
Vanguard US Total Market ETF	4,657	0.17%

VUN Stock

VUN is not ideal for investors who are looking for dividend income. It’s more suited for investors who seek long term growth. Please check our post on the Best Canadian monthly dividend ETF – 2023.

VFV vs VUN

In this section, we will compare VUN to VFV S&P 500 Index ETF. From an exposure point of view, both ETFs have the same goal, which is to offer investors exposure to the US Market. VUN has the advantage of being more diversified. For instance, VFV invests primarily in large US caps and has only 500 constituents. VUN includes small, mid, and large caps and has over 4,000 equities.

In terms of MER, VFV has a very low MER at 0.08% compared to 0.16% for VUN. Both VUN and VFV has a similar level of volatility and risk.

Since VFV invests in the largest 500 companies in the US economy, one can argue it offers exposure to ‘high-quality stocks’.

In essence, choosing between VFV and VUN comes down to personal preference. S you can see below, both had an excellent performance in the past five years. I am personally a big fan of the S&P 500 index because of the quality of its constituents and the diversification it offers across various sectors of the US economy.

Updated daily – VUN Stock

VUN vs VTI

VTI is the Vanguard Total Stock Market ETF. It trades in US dollars and is offered by Vanguard on the US stock exchange. In fact, VUN holdings are simply 100% in VTI. So, the question that most investors ask:

should I invest directly in the US listed ETF (VTI) or buy the Canadian equivalent VUN?

There are three key differences between these two ETFs:

VUN has higher management fees than the US listed version VTI. The difference is (0.15% for VUN – 0.05% for VTI = 0.10%);
Since VTI is US listed it has to be acquired in US dollars;
Taxation wise: if you hold VTI in an RRSP you can be exempt for the 15% tax withheld on non Canadian dividend payments.

In a nutshell, if you are investing in a TFSA, both ETFs will incur the 15% withholding tax on dividends. The only differences that will matter is the management fees and foreign exchange cost. Since the difference in terms of fees is small, I personally would rather own VUN avoid the foreign exchange cost.

In an RRSP, I would still stick to VUN as the dividend yield on VTI is only 1.21%. It’s not high enough to justify the switch.

VUN Sector breakdown

Sector	Fund
Technology	29.5%
Consumer Discretionary	16.5%
Industrials	12.6%
Health Care	12.4%
Financials	11.1%

Please issuers’ website for up-to-date data – VUN Stock

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VUN Morningstar rating

The Morningstar rating for VUN is 4 stars:

★★★★

VUN holdings

Holding Name	% Weight
Apple Inc.	5.5%
Microsoft Corp.	5.2%
Amazon.com Inc.	3.2%
Tesla Inc.	1.9%
Alphabet Inc. Class A	1.8%
NVIDIA Corp.	1.6%
Alphabet Inc. Class C	1.6%

Please issuers’ website for up-to-date data

As the global economy continues to evolve, investors are seeking opportunities beyond traditional markets to diversify their portfolios and achieve higher returns. Emerging markets ETF have emerged as a compelling option for Canadian investors. In fact, many investors are looking to tap into the growth potential of economies that are rapidly developing and expanding. One effective way to gain exposure is through Exchange-Traded Funds (ETFs) that focus on emerging markets.

Emerging markets encompass a diverse range of countries, including nations in Asia, Latin America, Africa, and the Middle East. These economies often exhibit higher growth rates compared to developed markets, driven by factors such as population growth and increasing consumer demand.

For Canadian investors, Emerging Markets ETFs provide an accessible and efficient avenue to participate in these growth stories. These ETFs are designed to track a basket of stocks or bonds from companies within emerging markets. By investing in an ETF, Canadian investors can mitigate some of the risks associated with investing in individual companies.

Best Emerging Markets ETF – Top 3 in Canada

Asset under management and inception date

Performance comparison

Unveiling the Potential: Exploring the Vanguard FTSE Canada All Cap Index ETF (VCN Stock)

VFV Review (2024): Vanguard S&P500 ETF For Canadians

Vanguard FTSE Emerging Markets All Cap Index ETF (VEE)

The Vanguard FTSE Emerging Markets All Cap Index ETF aims to replicate the results of the FTSE Emerging Markets All Cap China A Inclusion Index. Its investments are primarily in the stocks of large, mid-sized, and small companies situated within emerging markets.

iShares Core MSCI Emerging Markets IMI Index ETF (XEC)

XEC presents a clear investment objective: to secure long-term capital growth by mirroring the performance of the MSCI Emerging Markets Investable Market Index, net of expenses. This strategic approach serves as the foundation for several persuasive factors that make XEC an attractive consideration for investors.

Firstly, XEC offers Strategic Access to the promising long-term growth potential synonymous with emerging markets. Through this fund, investors can align their portfolios with the upward trajectory of economies on the rise.

Secondly, Cost-Effective Diversification is a key advantage that XEC brings to the table. With a straightforward and economical approach, investors gain ownership of a well-rounded collection of over 1500 stocks worldwide. This diversification can mitigate risk and amplify growth potential.

Furthermore, XEC is thoughtfully designed as a Core Holding for the long haul. Its structure is intended to act as a stable and fundamental element within investment portfolios, serving as an anchor amidst market fluctuations.

BMO MSCI Emerging Markets Index ETF (TSE:ZEM)

The main goal of the BMO MSCI Emerging Markets Index ETF is to mirror the performance of the MSCI Emerging Markets Index. The MSCI Emerging Markets Index itself reflects the combined performance of both large and mid-sized companies across 24 countries categorized as Emerging Markets. These markets countries consist of a diverse range including Brazil, Chile, China, Colombia, Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Korea, Kuwait, Malaysia, Mexico, Peru, Philippines, Poland, Qatar, Saudi Arabia, South Africa, Taiwan, Thailand, Turkey, and the United Arab Emirates.

With a substantial composition of 1,422 individual elements, this index effectively encompasses approximately 85% of the market capitalization that is freely traded and adjusted within each of these countries.

Welcome to the world of dividends, where investments turn into streams of passive income. In the realm of finance, dividends play a crucial role in attracting investors seeking both stability and a reliable source of returns. If you’re an investor in the Canadian stock market, particularly on the Toronto Stock Exchange (TSX), you’re likely interested in knowing when some of the largest companies listed on the TSX will be distributing their dividends.

In this article, we’ll be your dividend calendar guide, providing a comprehensive overview of the dividend distribution schedules for a select group of large-cap companies on the TSX.

Dividend Calendar Canada

February 2024 – Mid and Large caps

	Company	Ex-Dividend Date	Dividend	Payment Date	Yield
Tuesday, January 30, 2024
	Boardwalk REIT (BEI_u)	Jan 30, 2024	0.0975	Feb 15, 2024	1.66%
	Canadian Tire Ltd (CTCa)	Jan 30, 2024	1.75	Mar 01, 2024	4.73%
	Primaris Real Estate (PMZ_u)	Jan 30, 2024	0.07	Feb 15, 2024	5.96%
	Northland Power (NPI)	Jan 30, 2024	0.1	Feb 15, 2024	4.84%
	CT Real Estate (CRT_u)	Jan 30, 2024	0.07485	Feb 15, 2024	6.04%
	Riocan REIT (REI_u)	Jan 30, 2024	0.09	Feb 07, 2024	5.86%
	First Capital Realty (FCR_u)	Jan 30, 2024	0.072	Feb 15, 2024	5.59%
	Canadian Apartment Properties (CAR_u)	Jan 30, 2024	0.12084	Feb 15, 2024	3.08%
	Chartwell Retirement Residences (CSH_u)	Jan 30, 2024	0.051	Feb 15, 2024	5.23%
	Allied Properties (AP_u)	Jan 30, 2024	0.15	Feb 15, 2024	8.75%
	Killam Properties (KMP_u)	Jan 30, 2024	0.05833	Feb 15, 2024	3.73%
	Sienna Senior Living (SIA)	Jan 30, 2024	0.078	Feb 15, 2024	7.70%
	Tamarack Valley Energy (TVE)	Jan 30, 2024	0.0125	Feb 15, 2024	4.69%
	Whitecap Resources (WCP)	Jan 30, 2024	0.0608	Feb 15, 2024	8.15%
	Crombie REIT (CRR_u)	Jan 30, 2024	0.07417	Feb 15, 2024	6.44%
	Choice Properties REIT (CHP_u)	Jan 30, 2024	0.0625	Feb 15, 2024	5.29%
	Peyto Exploration&Develop (PEY)	Jan 30, 2024	0.11	Feb 15, 2024	9.98%
	Smart REIT (SRU_u)	Jan 30, 2024	0.15417	Feb 15, 2024	7.50%
	Northwest Healthcare (NWH_u)	Jan 30, 2024	0.03	Feb 15, 2024	7.24%
	H&R Real Estate (HR_u)	Jan 30, 2024	0.05	Feb 15, 2024	6.01%
	Exchange Income (EIF)	Jan 30, 2024	0.22	Feb 15, 2024	5.59%
	Freehold Royalties (FRU)	Jan 30, 2024	0.09	Feb 15, 2024	7.70%
	Granite REIT (GRT_u)	Jan 30, 2024	0.275	Feb 15, 2024	4.49%
	InterRent REIT (IIP_u)	Jan 30, 2024	0.0315	Feb 15, 2024	2.79%
	Dream Industrial REIT (DIR_u)	Jan 30, 2024	0.05833	Feb 15, 2024	5.15%
	Mullen Group (MTL)	Jan 30, 2024	0.06	Feb 15, 2024	4.60%
Wednesday, January 31, 2024
	Emera Incorporated (EMA)	Jan 31, 2024	0.7175	Feb 15, 2024	5.88%
	Canadian Utilities (CU)	Jan 31, 2024	0.4531	Mar 01, 2024	5.77%
	Richelieu Hardware (RCH)	Jan 31, 2024	0.15	Feb 15, 2024	1.38%
Thursday, February 1, 2024
	PayPoint (PAYP)	Feb 01, 2024	9.5	Mar 05, 2024	7.01%
	SSP (SSPG)	Feb 01, 2024	2.5	Feb 29, 2024	1.10%
	Paragon Banking Group (PAGPA)	Feb 01, 2024	26.4	Mar 08, 2024	5.25%
	Schroder Oriental (SOI)	Feb 01, 2024	2	Feb 16, 2024	4.88%
	Edinburgh Investment (EDIN)	Feb 01, 2024	6.7	Feb 23, 2024	3.97%
	IG Group (IGG)	Feb 01, 2024	13.56	Mar 01, 2024	6.32%
Friday, February 2, 2024
	MTY Food (MTY)	Feb 02, 2024	0.28	Feb 15, 2024	1.93%
Wednesday, February 14, 2024
	Enghouse Systems (ENGH)	Feb 14, 2024	0.22	Feb 29, 2024	2.35%
Thursday, February 15, 2024
	Imperial Brands (IMB)	Feb 15, 2024	51.82	Mar 28, 2024	7.59%
	Fortis Inc (FTS)	Feb 15, 2024	0.59	Mar 01, 2024	4.42%
	Pershing Square (PSHP)	Feb 15, 2024	0.1456	Mar 15, 2024	1.25%
	ICG Enterprise (ICGT)	Feb 15, 2024	8	Mar 01, 2024	2.70%
Thursday, February 22, 2024
	Virgin Money UK (VMUK)	Feb 22, 2024	2	Mar 20, 2024	3.42%
	EasyJet (EZJ)	Feb 22, 2024	4.5	Mar 22, 2024	0.85%
	Endeavour Mining (EDV)	Feb 22, 2024	0.41	Mar 25, 2024	4.47%

Dividend Calendar

January 2024 – Large caps

Compagnie	Ex-Dividend Date	Dividend $	Payment Date	Rend Div
Bank of Nova Scotia (BNS)	Jan 02, 2024	1.06	Jan 29, 2024	6.70%
Auto Trader Group Plc (AUTOA)	Jan 04, 2024	3.2	Jan 26, 2024	1.22%
Dollarama (DOL)	Jan 04, 2024	0.0708	Feb 02, 2024	0.30%
Experian (EXPN)	Jan 04, 2024	0.18	Feb 02, 2024	–
Toronto Dominion Bank (TD)	Jan 09, 2024	1.02	Jan 31, 2024	4.79%
Ashtead Group (AHT)	Jan 11, 2024	0.1575	Feb 08, 2024	–
Sage (SGE)	Jan 11, 2024	12.75	Feb 09, 2024	1.64%
SSE (SSE)	Jan 11, 2024	20	Mar 08, 2024	4.74%
Compass (CPG)	Jan 18, 2024	28.1	Feb 29, 2024	2.03%
Bank of Montreal (BMO)	Jan 29, 2024	1.51	Feb 27, 2024	4.64%
Mondi (MNDI)	Jan 29, 2024	1.6	Feb 13, 2024	–
Canadian Tire Ltd (CTCa)	Jan 30, 2024	1.75	Mar 01, 2024	5.00%

Dividend Calendar

December 2023

Company	Ex-Dividend Date	Dividend	Type	Payment date
Thursday, December 7, 2023
	Canadian Natural (CNQ)	Dec 07, 2023	1	Jan 05, 2024
Thursday, December 14, 2023
	Cenovus Energy Inc (CVE)	Dec 14, 2023	0.14	Dec 29, 2023
	BCE Inc (BCE)	Dec 14, 2023	0.9675	Jan 15, 2024
Thursday, December 28, 2023
	Nutrien (NTR)	Dec 28, 2023	0.53	Jan 12, 2024
	Canadian Pacific Kansas City (CP)	Dec 28, 2023	0.19	Jan 29, 2024

Dividend Calendar

November 2023

Company	Ex-Dividend Date	Dividend	Type	Payment date
Tuesday, November 7, 2023
	Waste Connections (WCN)	Nov 07, 2023	0.285	Nov 28, 2023
Wednesday, November 15, 2023
	Thomson Reuters (TRI)	Nov 15, 2023	0.49	Dec 15, 2023
Thursday, November 16, 2023
	Fortis Inc (FTS)	Nov 16, 2023	0.59	Dec 01, 2023
Tuesday, November 21, 2023
	Gildan Activewear (GIL)	Nov 21, 2023	0.186	Dec 18, 2023
Wednesday, November 29, 2023
	Brookfield Infrastructure Partners (BIP_u)	Nov 29, 2023	0.3825	Dec 29, 2023
Thursday, November 30, 2023
	Imperial Oil (IMO)	Nov 30, 2023	0.5	Jan 01, 2024
	Agnico Eagle Mines (AEM)	Nov 30, 2023	0.4	Dec 15, 2023

Octobre 2023

Company	Ex-Dividend Date	Dividend	Type	Payment date
Thursday, October 5, 2023
	Dollarama (DOL)	Oct 05, 2023	0.0708	Nov 03, 2023
	Toronto Dominion Bank (TD)	Oct 05, 2023	0.96	Oct 31, 2023
Monday, October 23, 2023
	Tourmaline Oil (TOU)	Oct 23, 2023	1	Nov 01, 2023
Thursday, October 26, 2023
	Metro Inc. (MRU)	Oct 26, 2023	0.3025	Nov 14, 2023
Friday, October 27, 2023
	Bank of Montreal (BMO)	Oct 27, 2023	1.47	Nov 28, 2023
Monday, October 30, 2023
	Canadian Apartment Properties (CAR_u)	Oct 30, 2023	0.12084	Nov 15, 2023
	Canadian Tire Ltd (CTCa)	Oct 30, 2023	1.725	Dec 01, 2023
Tuesday, October 31, 2023
	Emera Incorporated (EMA)	Oct 31, 2023	0.7175	Nov 15, 2023

What’s a Dividend Calendar

A dividend calendar is an essential tool for investors focusing on dividend income. It not only provides a schedule of when dividends are expected but also helps in planning investment strategies and managing cash flows efficiently. Here are some key components and additional advice for investors on how to leverage a dividend calendar effectively:

Key Components of a Dividend Calendar:

Declaration Date: The date on which a company announces its next dividend payment, specifying the dividend amount per share.

Ex-Dividend Date: This is crucial. To receive the declared dividend, you must purchase the stock before this date. Anyone buying the stock on or after the ex-dividend date will not receive the dividend.

Record Date: The company determines its shareholders eligible for the dividend on this date. It’s typically set shortly after the ex-dividend date.

Payment Date: The actual day when the dividend payment is made to the shareholders.

Advice for Investors:

Early Planning: Use the dividend calendar to plan your purchases and sales. Knowing the ex-dividend dates helps ensure you’re holding the stock at the right time to qualify for dividends.

Monitor Regularly: Dividend dates and amounts can change. Regularly checking your dividend calendar helps you stay updated with any adjustments.

Diversify Payment Dates: To ensure a steady income stream, consider investing in stocks or ETFs with staggered dividend payment dates. This strategy can provide more consistent cash flow throughout the year.

Consider Dividend Reinvestment Plans (DRIPs): Many companies offer DRIPs, allowing you to reinvest dividends into additional shares automatically, which can be beneficial for compounding growth over time.

Stay Informed About Market Conditions: Dividend payments can be influenced by economic factors and company performance. Staying informed can help you anticipate changes in dividend policies.

Tax Planning: Be aware of the tax implications of dividend income. In some jurisdictions, dividends are taxed differently than regular income, which can affect your investment strategy.

Use Technology: Leverage investment apps and platforms that offer dividend tracking and alerts. These tools can notify you of upcoming ex-dividend dates, payment dates, and any changes in dividend policies.

Tools to help with planning your Dividend Calendar

For investors looking to manage their dividend income effectively, several tools and platforms can be invaluable in tracking dividend payments, schedules, and related information. Here are some popular tools that can assist investors in staying on top of their dividend investments:

Brokerage Account Platforms: Many online brokerages provide integrated tools for tracking your investments, including dividend schedules. These platforms often offer personalized dividend calendars based on your portfolio, alerting you to upcoming dividend payments.

Investment Tracking Apps: Apps like Seeking Alpha, Dividend.com, and The Motley Fool offer features for dividend tracking, including calendars, alerts, and analysis on dividend-paying stocks.

Financial News Websites: Websites such as Bloomberg, Yahoo Finance, and MarketWatch provide extensive financial data, including dividend declarations, ex-dividend dates, and payment dates, along with tools to create personalized watchlists.

Personal Finance Software: Software like Quicken and Personal Capital allows you to manage all your financial accounts in one place, including investments. They can track dividends and help with overall financial planning.

Dividend Tracker Apps: Dedicated dividend tracker apps, such as Dividend Tracker and DRIP: Dividend Reinvestment Plan Tracker, are specifically designed to monitor dividend payments and schedules, helping investors plan their investment strategies around dividend income.

Spreadsheets: For those who prefer a more hands-on approach, custom spreadsheets created in Excel or Google Sheets can be powerful tools for tracking dividends, especially when combined with financial data APIs or manual updates.

Ninepoint Partners, a distinguished name in Canada’s alternative investment landscape, manages an impressive $8 billion in assets, providing a range of investment options including mutual funds and ETFs across various sectors. Among its offerings is the NNRG stock, a dynamic choice for those looking into the energy sector. This ETF, part of the Ninepoint Energy Fund, comes in two distinct versions, allowing investors to select the type that best fits their strategy and investment goals. Whether you’re interested in mutual funds or ETFs, Ninepoint’s NNRG stock stands out as a specialized, high-potential investment in the energy domain.

The NNRG ETF version was launched in May 2021. Both have the same stated objective.

NNRG ETF Objective

NNRG ETF invests primarily in mid-cap companies involved directly or indirectly in the exploration, development, production and distribution of oil, gas, coal, or uranium and other related activities in the energy and resource sector.

The fund is an active ETF. The fund does not replicate an index. On the contrary, the portfolio manager selects stocks that best fit the funds’ stated objective. NNRG is suited for investment with high-risk tolerance.

The fund invests mainly in Canadian companies.

ZEB ETF Review: BMO Equal Weight Banks Index

Best Canadian Bank ETFs 2024

NNRG Management fees

The management fees for NNRG are 1.50%.

NNRG trades on the Neo Exchange, which is a Canadian stock exchange based in Toronto.

NNRG ETF vs XEG and ZEO Fees

	Fees	AUM
NNRG.NE ETF	1.50	361
Ninepoint Energy Mutual fund Series F
XEG – Ishares S&P TSX Capped Energy Idx	0.55	1,762
ZEO -BMO S&P TSX Eql Weight Oil Gas Index	0.55	260
ENCC – Horizons Canadian Oil And Gas Equity Covered Call ETF	0.81	240

Barchart and Issuers’ website

NNRG ETF vs XEG vs ENCC and ZEO: Historical performance

SYMBOL	3 YEAR AVG RETURN	5 YEAR AVG RETURN
NNRG.NE	–	–
Ninepoint Energy Fund Series F	60.42%	30.76%
XEG.TO	40.34%	13.97%
ZEO.TO	31.67%	13.52%
ENCC.TO	39.57%	15.56%

As of December 27th 2023

Analysis

Let’s compare NNRG ETF to two well-established alternatives: XEG (iShares S&P TSX Capped Energy Index) and ZEO (BMO S&P TSX Equal Weight Oil Gas Index). It’s important to note that both XEG and ZEO are passive ETFs designed to track the performance of the energy sector. While NNRG ETF was introduced in May 2021, providing us with less than 3 years worth of performance data, we can use the mutual fund version for a comparative analysis with XEG and ZEO.

Unsurprisingly, XEG and ZEO come with lower fees compared to NNRG. This cost differential is to be expected, given that NNRG operates as an active ETF.

ENCC.TO: This covered call ETF has a 39.57% 3-year average return and a 15.56% 5-year average return. The relatively high returns, especially over the 3-year period, indicate that ENCC.TO’s strategy of selling call options on top of holding energy stocks has been effective in generating income, contributing to its overall performance. The covered call strategy is particularly focused on income, making ENCC attractive for investors seeking higher yield. However, it’s important to note that selling call options can cap the upside potential of the underlying stocks during strong market rallies.

When it comes to performance, NNRG stands out as the clear winner. The fund has delivered exceptional results in both the short and long term. Opting for an active ETF, particularly for long-term investments, holds significant value in this scenario. Several factors contribute to NNRG’s remarkable performance:

NNRG’s investment focus on mid-cap energy companies, whereas both XEG and ZEO are predominantly composed of large industry leaders.
The benefits derived from active management, which allows for more strategic and adaptable investment decisions.

Full list of ‘Dividend Kings’ stocks by sector

Review of UMAX: Hamilton Utilities Yield Maximizer ETF (13% Target yield)

NNRG Stock price

Top Ten Holdings

Top Ten Holdings as of 12/29/2023

Arc Resources Ltd

Athabasca Oil Corp

Baytex Energy Corp

Cenovus Energy Inc (Alberta)

Crescent Point Energy Corp

Headwater Exploration Inc

Meg Energy Corp

Precision Drilling Corporation

Tamarack Valley Energy Ltd

Whitecap Resources Inc (Pre-Merger)

NNRG Sector allocation

Oil & Gas Exploration & Production	80.08
Integrated Oil & Gas	16.49
Cash And Cash Equivalents	3.43

Q&A

Is NNRG an ETF?

Yes, NNRG is an ETF that primarily invests in mid-cap companies involved in the energy and resource sector, particularly those related to the exploration, development, production, and distribution of oil, gas, coal, or uranium. It trades on the Neo Exchange in Canada.

Who are the top holdings of the Ninepoint Energy Fund?

The top holdings of the NNRG ETF include a range of mid-cap energy companies, such as Athabasca Oil Corp, Baytex Energy Corp, Canadian Natural Resources Ltd, Cenovus Energy Inc (Alberta), Chord Energy Corp, Headwater Exploration Inc, Meg Energy Corp, Nuvista Energy Ltd., Tamarack Valley Energy Ltd, and Whitecap Resources Inc. These holdings reflect the fund’s focus on mid-cap energy companies.

What stocks are in Ninepoint Energy Income Fund?

While specific stocks in the Ninepoint Energy Income Fund aren’t listed in the provided information, it’s likely similar to the NNRG ETF, focusing on mid-cap companies in the energy sector. For the most accurate and up-to-date information, reviewing the fund’s most recent holdings through official Ninepoint Partners reports or disclosures is advisable.

How big is Ninepoint Partners?

Ninepoint Partners is a significant player in Canada’s alternative investment management scene, overseeing approximately $8 billion in assets under management and institutional contracts. This size reflects its broad range of investment offerings, including mutual funds and ETFs targeting various sectors.

The allure of the best dividend paying ETFs, especially those with yields surpassing 10%, stands out prominently. Our focus here is on uncovering these high-yielding ETFs, predominantly within the realm of covered call ETFs, known for their exceptional dividend payouts. Adhering to a meticulous methodology, we spotlight ETFs that not only offer an impressive dividend yield of over 10% but also maintain a minimum Asset Under Management (AUM) of $100 million, blending high yield with financial stability.

These ETFs present an attractive proposition for those seeking to enhance their income streams, combining the benefits of regular dividend payments with the potential for capital appreciation. Particularly, covered call ETFs utilize an options strategy to generate additional income, thereby elevating their dividend yield.

Best Dividend Paying ETFs: Comparison AUM and MER

Dividend yield

Name	Div Yield
HMAX -HAMILTON CDN FINANCIALS YD MAX ETF	15.52%
ENCC -HORIZONS CDN OIL GAS EQTY CVRD CALL	14.69%
HPYT -HARVEST PREMIUM YIELD TREASURY ETF	14.62%
UMAX -HAMILTON UTILITIES YIELD MAXIMIZER ETF	13.79%
HYLD -HAMILTON ENHANCED US COVE CALL ETF	12.09%
QMAX -HAMILTON TECHNOLOGY YIELD MAXIMIZER	11.72%

Source TD Market Research & Trading view – *MER not yet published, the percentage indicate the management fee only, the MER could be much higher. As of December 15th, 2023

Asset under management and inception date

HMAX – Hamilton Canadian Financials Yield Maximizer

HMAX ETF is a new fund offered by Hamilton ETF. The fund invests in the Canadian banking sector. This fund aims to provide an attractive dividend yield (target 13%) using a covered call strategy. The strategy consists of writing call options on (50% of the portfolio) to collect premiums and maximize monthly distributions.

What Does HMAX Hold?

TICKER	NAME	WEIGHT
RY	Royal Bank of Canada	22.2%
TD	Toronto-Dominion Bank	20.1%
BMO	Bank of Montreal	10.8%
BNS	Bank of Nova Scotia	9.7%
BN	Brookfield Corp	9.5%
CM	Canadian Imperial Bank of Commerce	6.5%
MFC	Manulife Financial	6.3%
SLF	Sun Life Financial	5.3%
GWO	Great-West Lifeco	5.1%
IFC	Intact Financial	5.0%

ENCC – Horizons Canadian Oil and Gas Equity Covered Call

ENCC is specifically crafted to cater to Canadian investors. Its central mission encompasses:

a) Providing an avenue for Canadian investors to access the performance of an index comprising domestic companies operating within the crude oil and natural gas industry. The current representation of this index is the Solactive Equal Weight Canada Oil & Gas Index.

b) Delivering monthly distributions that encompass dividend earnings and call option income, while factoring in expenses.

To effectively manage and potentially mitigate downward market risks while simultaneously generating income, ENCC will employ a dynamic covered call option writing strategy tailored to the preferences and needs of Canadian investors.

Portfolio

Security Name	Weight
ARC Resources Ltd	12.57%
Tourmaline Oil Corp	11.60%
Keyera Corp	10.62%
Canadian Natural Resources Ltd	10.11%
Imperial Oil Ltd	10.04%
Cenovus Energy Inc	9.70%
Enbridge Inc	9.10%
Pembina Pipeline Corp	9.05%
Suncor Energy Inc	8.76%

HPYT – Harvest Premium Yield Treasury ETF

HPYT aims to provide unitholders with a high monthly distribution yield, with a secondary objective of preserving capital. The fund primarily invests in a diversified portfolio of U.S. treasury securities. By employing a covered call strategy, HPYT seeks to enhance the yield on its portfolio, offering investors an opportunity to gain regular income while maintaining exposure to low-risk treasury assets.

QMAX – Hamilton Technology Yield Maximizer

QMAX’s investment objective is to provide unitholders with a high monthly income through a combination of dividend and option strategy income, with a secondary focus on long-term capital appreciation. The fund invests in an equity portfolio of global technology companies. QMAX aims to maximize income yield from these technology investments while also offering potential for capital growth.

UMAX -Hamilton Utilities Yield Maximizer ETF

Hamilton introduced a new ETF called UMAX, which focuses on the utilities sector (UMAX was launched June 14th 2023). This ETF is designed to provide investors with attractive monthly income while offering exposure to a diversified portfolio of utility services equity securities primarily listed in Canada and the U.S. UMAX aims to reduce volatility and enhance dividend income by employing an active covered call strategy.

TICKER	NAME	WEIGHT
BCE	BCE Inc	7.7%
TRP	TC Energy Corp	7.7%
ENB	Enbridge Inc	7.7%
RCI/B	Rogers Communications Inc	7.7%
FTS	Fortis Inc/Canada	7.7%
EMA	Emera Inc	7.7%
PPL	Pembina Pipeline Corp	7.7%
WCN	Waste Connections Inc	7.7%
CNR	Canadian National Railway Co	7.7%
H	Hydro One Ltd	7.7%
T	TELUS Corp	7.7%
NPI	Northland Power Inc	7.7%
CP	Canadian Pacific Kansas City Ltd	7.7%

Risks Associated with Covered Call ETFs

Variability in Distribution

A key characteristic of covered call ETFs is that their distributions can vary significantly, primarily because the option premiums, which are a major component of the yield, are not fixed. The income generated from selling call options depends on market volatility and the price movement of the underlying stocks. In periods of low market volatility or when stock prices are stagnant, the premiums received from selling options may be lower, subsequently reducing the overall distribution yield of the ETF. This variability can make it challenging for investors who rely on consistent income streams.

Risk of Capital Erosion

Another risk in some covered call ETFs is the potential for capital erosion. In rare instances, if the option premiums and dividends are not sufficient to meet the distribution targets, fund managers might resort to selling stocks within the portfolio. This practice, known as capital erosion, can diminish the fund’s asset base, impacting its long-term income-generating capacity and potentially leading to a reduction in the value of the ETF. To mitigate this risk, investors should select funds managed by reputable managers who possess strong expertise in options trading.

Covered Call Strategy and Growth Limitation

The covered call strategy, while beneficial for generating income, inherently caps the potential growth of the ETF. By selling call options, the fund gives up the upside potential beyond the strike price of the options. In a strong bull market where the underlying stocks may experience significant appreciation, the fund will not fully capitalize on these gains. As it is obliged to sell the stocks at the strike price. This limitation means that investors may miss out on substantial growth opportunities seen in a rising market.

No Safeguard Against Market Downturns

It’s also crucial to understand that a covered call strategy does not safeguard against market downturns. While the income from option premiums can provide some cushion, it may not be sufficient to offset significant declines in the underlying stock prices. Therefore, during market downturns, covered call ETFs can still experience substantial declines in value. This aspect emphasizes the importance of considering these ETFs as part of a diversified investment strategy rather than a standalone solution for income or growth.

In summary, while covered call ETFs offer an appealing avenue for income generation, understanding the associated risks is vital. Investors should consider the variability in distributions, potential for capital erosion, limitations on growth, and volatility when incorporating these ETFs.