ZWB ETF

ZWB – Full review of BMO Covered Call Canadian Banks

Investment objective

The ZWB ETF aims to provide exposure to a portfolio of dividend-paying securities (Canadian Banks), while collecting premiums related to call options. The portfolio is chosen on the basis of the criteria below:

• dividend growth rate, yield, and payout ratio and liquidity.

What’s a covered call ETF?

What’s unique about this ETF is that it uses covered calls to 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. These ETFs will tend to have a higher yield and a lower performance.

ZWB is an excellent option for conservative investors looking for a steady income, moderate volatility and exposure to the Canadian banking sector. It’s tax-efficient because the dividends are all coming from Canadian banks.

Please consult our recent post comparing ZWB with other popular High Dividend ETFs in Canada.

Historical performance

ETFDiv
Yld
ZWB6.79%

Historical performance updated daily

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ZWB MER

ETFMER*
%
ZWB – BMO Covered
Call Canadian Banks
0.71

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ZWB Stock Profile

Updated daily

ZWB Stock 52 weeks high and low

Updated daily

How to choose a good dividend ETF

– Total return: Though the focus here is on the dividend yield, you have to keep in mind the total return. The profit or loss we make on any investment combines both dividend income and capital gain or loss. Looking at the long-term performance of the fund is crucial. An ETF that provides a good capital appreciation with a high dividend yield is preferable.

Diversification: A diversified ETF is always a safer option. Some high yield ETFs are sector-specific (Financials, Energy or Gold). The ones focused on Energy and Gold have had an inferior long-term performance and carry high volatility risk.

Volume and liquidity of the ETF. The higher the asset under management, the lower the trading costs of the ETF (difference between the bid and ask price).

ZWB Dividend history

PeriodEx-Div
Date
Record
Date
Pay
Date
Total
Distribution
Per Unit
déc-222022-12-282022-12-292023-01-030.11
nov-222022-11-282022-11-292022-12-020.11
oct-222022-10-272022-10-282022-11-020.11
sept-222022-09-282022-09-292022-10-050.11
août-222022-08-292022-08-302022-09-020.11
juil-222022-07-272022-07-282022-08-030.11
juin-222022-06-282022-06-292022-07-050.11
mai-222022-05-272022-05-302022-06-030.11
avr-222022-04-272022-04-282022-05-030.11

ZWB ETF Holdings

NameWeight
BMO Equal Weight Banks ETF27.2%
  Bank of Montreal12.9%
Canadian Imperial Bank of Commerce12.7%
Royal Bank of Canada12.1%
National Bank of Canada11.9%
  The Toronto-Dominion Bank11.9%
Bank of Nova Scotia11.4%

Consult issuers’ website for up-to-date data

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