Build an ETF Portfolio for Retirement Income with Covered Calls
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- Опубліковано 20 вер 2024
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In this video we'll build a retirement income portfolio using five ETFs from this video's sponsor, Harvest ETFs.
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In retirement, you need reliable, consistent, dependable income in your investment portfolio. Here's a look at Harvest ETFs that will provide exactly that, with growth potential as well.
Thank you to Harvest ETFs for sponsoring this video. Enjoy.
www.harvestportfolios.com
It’s a UA-cam channel, don’t be butt hurt. I love harvest myself. Hold many of their ETFS. Thanks for the great info, remember investing is at your own risk.
Just tuned in to this particular video for the first time ( it's now Feb 2024 )....I do have 1 of these funds in my portfolio as well as a couple others from Harvest no mentioned. Anyways, nice precis of what one could put together, and the central themes covered here are ones I am taking to heart. Thanks ! I look forward to another presentation some time in 2024 like this, but more detailed....perhaps build us retirees a couple balanced portfolios with some covered calls and a good mix of funds whether it be harvest, hamilton, brompton or others. I like diversity of geography plus sectors plus individual stocks and also the ETF's managers.
Marc, just shared your presentation with a more senior investor but quite smart and retired living the F.I.R.E. life. It was your explanation of options using the vehicle that pulled the trigger for excellent presentation. My senior friend reached out asking about options and cover calls. Your visual and helpful presentation will help him a lot as it did with me. Nice job there Marc💯🇨🇦
Thanks for sharing, and happy to hear the explanation of covered calls resonated! - Marc
There is nothing better than index or ETF investing, especially for those in need of safety and returns... My entire portfolio is built off of VTI. After that index of a foundation, I then began investing into big players within the index from AAPL to JNJ, etc...
Sounds like a reasonable strategy. - Marc
Excellent explanation of covered calls! Would love to hear an update on this ETF retirement income strategy as it's mid 2024!
Thank you for reviewing Harvest. My TFSA is built around HDIF but also HYLD and HDIV. Would love to see you guys do a review of Hamilton range of ETFS Covered Calls. Excellent work guys! Can't say enough good things about this channel :)
Thanks so much... we appreciate you watching. - Marc
Yes, I would like to see that as well, the Harvest ETF's. I have Hdiv and Hyld. With Marcs magic in presentation and selection of information I would imagine it would be very valuable and enjoyable, as per the usual.💯🇨🇦
See what hyld holds and then look at the nav of these holding like qyld, xyld...
HDIF is their all in one. It has most of the ones you talked about today. Current yield is about 9.8%
Yes, that's an option with Harvest ETFs. We'll be looking at that fund in more detail in the weeks to come. Thanks for watching. - Marc
Hi Marc, you did a brilliant presentation on ETF and taxation situations. I was wondering if you would consider building on that presentation by doing two things: comparing HHL with PRM and during that session talk about the taxation treatment in an investors portfolio. From what I can notice, HHL has different taxation issues compared to PRM. Maybe mention that the withholding taxes are "NET" of the dividend payment. That means, I believe but correct me if I am wrong, that the fund "pays the withholding tax within the fund so the investor does not have to" and that the dividend does NOT include the amount of the withholding tax. A lot of Canadians might not be aware that these two health investment vehicles are quite similar in portfolio holdings, with HHL having considerably more, but the taxation treatments are different, and of course vary from year to year i.e. some years capital gain divvy, other years ROC and other years eligible dividend or a combo of either mentioned. I hope I have made some sense in all this yada yada yada comment😊🙃. Your deeper dive on this topic, by showing no two health care investment vehicles are the same, would be EPIC! Cheers and thank you Marc for helping us and doing it so well. From Atlantic Canada, the Fiona epicenter🥴 in restoration mode for months and months.
I recently invested in HDIF and will hold for probably 20 years. Looks promising. Appreciate the content. Thanks
Awesome, Derrick. Cheers. - Marc
I typically like your videos and I already see the value in covered call strategies. Unfortunately the fact they’re sponsoring the video gives me a slimy feeling that this is an ad and I can’t take it seriously.
Thumbs down on this one for me.
Sorry to hear that, Christian. I hope the content of the video, whether sponsored or not, is valid and provides education to those who are learning about this type of investment. Hope to see you again on another video, though. Cheers. - Marc
Harvest ETF's are fairly new to the game (since 2009) and have an unproven track record. I personally would not recommend harvest to anyone near retirement or at retirement age for 3 reasons signs to me personally: 1) much of the distributions for their ETF's are ROC or capital gains as well as foreign income... their are major tax implications, so the yield is very misleading. These are not eligible dividends we are talking about that have tax benefits. 3) the MER is 0.85%, a huge major drag on say HHL which has provided a 6% return historically. The TR of all of their funds are BAD. And everyone knows, total returns is all anyone cares about. One would do much better by dumping their money into VTI or VOO than any of the income ETF's I saw advertised by Harvest.
Do you personally have any of Harvest ETF's in your portfolio? I didn't hear you mention so and if so, which one(s)?
Appreciate your feedback. I don't own any ETFs at all in the equity space, because I manage my own portfolio of individual securities. Not suitable for everyone, and ETFs play a role for those folks. Cheers - Marc
Just taking some time to go back over comments and thought I'd add a bit to my initial reply. I'm a bit surprised to hear your comment on the track record, but to each their own. When you think of the explosive growth in the space, Harvest certainly has been around for a reasonable period of time. The vast majority of ETFs in Canada have been around less than 10 years. The tax issues would be dependent on account type, of course. When you look at recent reporting for the funds covered in this video, there's a mix of distribution sources, of course, but nothing that would raise any red flags for me. Some of the funds reported no ROC, but of course all of this is subject to change depending on the prevailing conditions. As you noted, a $ of distributions are capital gains (which I think you pointed to as a negative) but those distributions do receive preferential tax treatment in taxable accounts, of course. Management fees of between 0.50% and 0.85%, depending on the ETF, are in the ballpark with similarly structured funds, but yes, of course much higher than a passive index fund. As for returns, not sure which timeframe you're looking at, but I took a quick 1, 3 & 5 year look, and in all 3 cases the TSX and S&P TR was sandwiched in between the funds in this video. (x HLIF, obviously). Just for fun, I added VTI and VOO, and the results were the same.
Anyway... that's a more comprehensive reply to your comment, which I thank you for. I always appreciate a healthy discussion. - Marc
As a new investor, thank you for the clear and cogent explanation of covered calls.
Our pleasure, Lee, and thanks for watching. - Marc
You guys need an options segment, because this was the most easiest digestible way to understand the broad topic of options
Nice presentation.
However, I find pointing out yield, then saying distributed monthly is misleading.
For example : At 15:13, let's say I have one unit that I bought at 18.52, based on the information, I should receive 0.1166 cash per unit.
Meaning I get (0.1166)/(18.52) = 0.62 %.
0.62% monthly for my one unit.
Now if I hold that one unit for a year, then I should get 1.39 in total payment which is 7.5%.
correct statment in the video should be " yearly yield is 7.5% that is distributed monthly"
Ran a quick Backtest on Portfolio visualiser - comparison between HBF and a random sampling of 10 stocks from its constituents. Results are startling - CAGR on HBF is 8.91 vs around 18% for the constituents portfolio - in other words, $10K invested in HBF will be around 19K vs 35K in a portfolio of its constituents - so is Covered call (With Juicy MER for its peddlers) ETF really a good investment? Looks like someone else is HARVESTING all your yield 🙂
Thanks for commenting. I'd love to know the time horizon of your backtest. I tried simulating your results (random sampling the holdings) but couldn't find those numbers. I assume you're testing on total return? Very interested in knowing, thanks. - Marc
Very nice content about Harvest ETFs, I would love to have you opinion on HDIF distributions and management fees
Thanks for the great video Marc. One could also just get HDIF and get them "all in one". Only disadvantage is you don't decide the ratios of the ETFs relative to each other.
You pretty much could, yes. As you point out, you don't control the sector ratios, if that's something that's important to you. HDIF also has one extra fund, HUBL. But conceptually, you'd be ok with either the fund of funds, or setting up a mix more specific to your objectives. Thanks for adding to the discussion. - Marc
Another is HDIV, is a gem! I bought some a few months ago when it was below the NAV, but I also use stock chart indicators, about 5 of them, to help decide when the price looks to be in over sold territory. I have a stink bid in for HDIV waiting for more pullback in this "recession" we are in. You know what they say for Passive Income Investors, "Buy low, and buy lower, and lower and lower etc" because we like to hold for years and not sell. HDIV has preferential taxation that I like and have to pay attention to because it is going to be in a non registered account, so need that preferential taxation pocket😊 Nice commment ib516💯
If you buy any index etf, you don’t decide which stocks or to what proportion each stock is held either
How realistic is it to rely on these etf's for a long term investment strategy? Do you think you can realistically hold these holdings for 20+ years?
Given the underlying assets these funds hold, I'm comfortable as a long-term holding. Depends of course on your personal objectives, circumstances, etc., but that's my general take. Appreciate you watching the video and asking your questions. - Marc
So Ticker HDIF invests in 6 of these ETF's you mentioned??
The 5 I covered, and one extra. - Marc
I own HDIF, which is made up of six of harvest's ETFs, including the five you reviewed. It's new though; inception date of Feb 2022...it is on my list of 'things to consider buying more of".
HDIF is a core holding for me. Set it and collect a monthly paycheck.
Yes, they do have HDIF as a fund of funds solution. Thanks for sharing, Robert - Marc
@@beaviswealth I couldn’t choose between them, so….
Disappointed that was nothing but a review of Harvest ETFs. I get it that you need sponsored videos from time to time but I hope you’ll get back to doing the great educational videos I like to see and learn from.
Thanks for watching, Ron. Yes, this video did feature Harvest ETFs, but as always, we'll be posting a mixture of this type of video, for those who want to take a deeper dive into these funds, mixed with general interest educational videos like you suggest. We'll try to find the right balance. Appreciate your support of the channel. - Marc
Indeed
Great ideas. Something I would like to see you cover on more detail is the aspect of leverage. How does it enhance or possibly detract from returns. Also what is the tax treatment of these funds which contain US and International companies. Withholding tax, no dividend tax credit, etc. how does that impact us as an after tax return and where is the best place to hold these funds; non-registered, rrsp, TFSA. Keep the videos coming
Hi Marc. Do you own any of these Harvest ETF funds?
Hi John. I don't. For my equity investments I manage my own portfolio of individual securities, and use ETFs for fixed income only. For someone who is looking for a simpler solution, ETFs are appropriate in many cases. Thanks for asking. - Marc
I sold HHL and HUTL and now investing in HDIF as it’ s Harvest all in one ETF and the yield is close to 10% very surprising you never mentioned that option ? I find it’s no reason to hold all these Harvests ETF’s when you can get them all in HDIF and your fees are lower.
Hi Rob. We'll be covering HDIF in a future video... this video was about using a line of ETFs, but for sure, a lot of people choose the single fund of funds to keep things easier. Thanks for watching. - Marc
This is really useful, to see what's behind the curtains and what makes the various funds unique or different in their approach. Nice to find a good Canadian youtube channel explaining investing.
Thanks so much... glad you enjoyed the video. Appreciate you watching. - Marc
Hello Marc, thanks for a great video as always. What are the costs of these ETFs ? Also, would it be a good idea to use asset allocation ETF (example : XGRO or XBAL) for fixed income in retirement?
Hi Andrew. The MERs on these ETFS are higher than a generic index fund would charge, but in line with competition with the same integrated strategies. I'm not a huge fan of the AA ETFs, but that's because I'm pretty hands-on with my investments. For a more passive investor, something like XGRO or XBAL might be a solution. I'm planning a video in the next while talking about balanced funds in general.. hope you get the chance to check it out. - Marc
@@beaviswealth Hello Marc, thanks for your response. Mathematically there’s no difference between using dividends or selling some shares for income in retirement, the end balance is the same. Dividends are just psychological making investors feel good when they see cash flow in their accounts. There is never free lunch. High MERs of covered call ETFs are eroding a capital appreciation over time. At the end of the day the total return is all that matters. Most investors are better off investing in low cost index funds or one ticket asset allocation funds capturing the entire stock market.
HTA is one of harvests best ETFs. Amazing returns higher than the SP500. Similar to QQQ better then TXF
Thanks for watching... - Marc
Hamilton ETFs do an interesting thing with Covered calls. They take some of these etfs, bundle them, then add a 25%margin to them, boosting income
Thanks, Richard. I 'm not as up to speed on the Hamilton funds, but that strategy sounds reasonable. Harvest does something similar with HDIF, which is their fund of funds. Thanks for watching the video - Marc
Hi Marc. Wouldn't the HYLD ETF be analogous to the USD-based XYLD ETF? Here are my following objective observations
1) The CAD hedged HYLD has a slightly higher fee of 0.65% vs 0.6% for the XYLD. That's good.
2) I might be mistaken but isn't the whole point of retirement capital preservation? A covered call ETF uses leverage so historical context suggests that XYLD is extremely volatile. For example, if someone started investing in Jan of 2022 YTD returns would have been down -30% for your HYLD versus (only) -23.15% for the XYLD. This is with the anticipation of a proposed monthly dividend which is at the discretion of Horizons. So in a bull market, it's great but in a bear market, it can be a tragedy for retirees. They would need 10% dividends for 3 years just to make back their losses.
Subjectively I find this video quite misleading as to the aforementioned facts vis a vis HYLD YTD performance. You mentioned
1) it provides a higher yield vs just owning the fundamental assets which are true.
2) You also mentioned the strategy also provides some downside protection in a volatile market which is categorically false.
3) Furthermore with regards to the car example you did not mention that the option can expire along with the loss of the fee (premium) if the price drops.
4) 2) If Horizons are sponsors, is this an advertisement or genuine advice/information?
5) I was under the impression that CFPs were fiduciaries? Is there a conflict of interest here?
Hi Mahir. Happy to have a conversation with you. Maybe you can clear up a few things:
1. Why are you asking about HYLD? I don't mention that ETF in this video.
2. Capital preservation is often a major goal in retirement, but each situation is unique. Income is often a high priority as well, depending on issues such as other income sources, life expectancy, etc. I respectfully disagree that the 'whole point' of retirement is capital preservation. Too broad of a statement.
3. None of the ETFs I covered in this video use leverage.
4. In general, a covered call strategy does provide downside protection. If I said, "in a volatile market", I should have said, 'in a down market." You say that's categorically false. I welcome your explanation.
Also on this same topic, if an option expires you do not lose the premium if the price drops.
5. Ethically, I'm able to balance providing genuine information and strategies alongside a sponsored video. Not a problem.
6. The subject of true fiduciary duty in Canada is still under debate, sadly. Strictly speaking, most advisors in Canada are not held to the highest 'fiduciary' standards, per se. They are required to 'place their clients' interests ahead of all others', but that's not the same. Weird, huh? A Portfolio Manager (along with the discretionary nature of that position) does have a fiduciary duty. All that said, at the end of the day, the courts can determine such a duty applies, even if it isn't explicitly found in the regulations. So, during my career, I was a CFP, which did not come with the explicit fiduciary duty, and also a Portfolio Manager, which did. As of my retirement, I'm no longer either a CFP or a PM.
Look forward to your further comments. - Marc
Hello - any thoughts about HDIF Harvest multi sector ? 😎
Although the video is interesting , I think that promoting your sponsor isn’t a good idea when the channel suppose to serve the community with unbiased recommendations. This may put you in a conflict of interest, and may harm your reputation.
Thanks for taking the time to share your views. Our goal is always to provide good, solid information that will help our viewers learn more about this complicated field of investing. In some cases, our videos are sponsored and in others they aren't, but in all cases, we're not going to say anything we don't believe in. I hope that if you view the complete video it does provide valid information on what goes into building a portfolio of ETFs, whether they are Harvest's fund, or another fund company. That was the goal at least. Again.. appreciate you watching, and thanks for your comment. - Marc
Agreed
I agree with you Brandon.
Agree with Brandon. I think it’s a pretty transparent video and details information from the sponsor which is relevant to the subject matter
great explanation!! I've been confused on how covered calls work until now - thank you Mark!
Glad this cleared things up, Maria. Thanks. - Marc
A very solid bunch of ETFs. I have always liked the Harvest ETFs for reliability and variety of exposure. Great job too on explaining covered calls.
Thanks. - Marc
I believe all of the covered call ETFs limit the proportion of shares they write calls on. BMO and Brompton offer similar products. One of the better balanced is JP Morgan JEPI but US fund best kept in RRSP to avoid tax withholding. Do you agree? What about using covered call ETFs as a growth strategy in a volatile market? What are the potential risks? I believe there is a risk they don't pay sometimes if asset value drops below threshold? In terms of total return how do they compare to just holding these dividend stocks and enjoying their growth over time?
Lots of great questions but I can't realistically answer them all right now. Generally, just to touch briefly on each:
1. JEPI and taxes. I do agree. Have to consider other factors as well though, not just taxes.
2. Covered calls for growth in a volatile market. Can help, if by volatile you mean negative markets. The premiums will help mitigate the damage.
3. I think you might be talking about Split Share corporations when you're talking about the threshold, but each fund will have its own prospectus info summing up what they can do.
4. CC ETF vs just holding stocks; so much depends on the actual investments themselves, whether dividends are reinvested, etc. Great question, but really hard to make a blanket call on that.
Hope this helps... thanks for watching. - Marc
Watched and liked, thanks Marc! Excellent video as usual.
Much appreciated, Jason. Always nice to hear from you. - Marc
Hamilton has some good ones too for higher yield even more with some leverage
Hey Brandon! Thanks for another great video. Are you able to shed some clarity as to whether or not Harvest pays or provides any incentive to you recommend or hype their products. I just think it would be beneficial to be transparent and honest regarding this, as I know many followers trust in your opinions and advice . Much appreciated
UMM not sure if you missed it but at the end of the presentation Marc mentioned that this video was sponsored by Harvest? I would think that is being as transparent as you can expect anyone to be. It's like when Hockey night in Canada(I assume you are Canadian) has a sponsor for one of their segments. The said sponsor is paying for that "advertising space". I would expect that Harvest funds have paid some sort of compensation to have this type of video made featuring their product. However I also feel that Marc and Brandon are not going to "plug" a product that they don't have at least a measure of confidence in- of being beneficial for at least some of their viewers. Maybe I'm not understanding your question properly, sorry? It sounds like you are asking them to tell you how much they got paid for this advertisement, and that's not really any of our business(it's theirs, and revenue Canada's I suppose.). I'm just glad they do announce their sponsorships, it makes their incentive clear to the viewer and we can decide at what the level of trust we should apply to this "not financial advice" haha. Maybe I misunderstood what you are asking for? If I didn't misunderstand, then that question, I find a bit rude-just sayin'.
Hi Bishop. Appreciate you following our channel and asking this question. Without getting into specifics, companies from time to time do provide compensation to UA-cam channels to highlight their service or products. In this case, Harvest has sponsored this video series, and in fact when you start the video, it shows "Includes paid promotion" on the screen, I did mention that Harvest has sponsored the video twice during the video, and also in the written disclosure. We would hope this provides sufficient disclosure and transparency. All that said, we regularly turn down sponsorship opportunities for companies we don't fully believe in, and so if we do post videos that are sponsored, we will disclose that and also you can be assured we're comfortable with their product or service. Sponsored or not, our goal is to educate our audience. Hope that helps! - Marc
@@beaviswealth excellent thanks for that
Correct me if I'm wrong but don't these products end up returning a lot of ROC and erode your initial principal?
I've heard that Covered Call strategies end up losing in the long run when considering total return. They pay higher income, but don't grow as much as if you held only the equities. Have you or they looked back over the last few years and compared the total return of holding their find vs holding a similar fund without the covered call feature. I bought a covered call Canadian Bank ETF and I have done worse than if I had held a similar ETF without the covered call.
Hi Ryan. I'd say in most cases a well run options strategy can complete nicely with a non-optioned portfolio, but it's no guarantee. In a strong bull market, you'd expect a covered call strategy to underperform, and in a down market, the opposite. Important to know that all covered call strategies aren't run the same, so it also depends on the expertise of the options traders.... that's a big wild card. Something I really do like about the Harvest funds is that they put a hard cap of 33% of any stock to have options written against it, so unlike a fully optioned portfolio, they will still participate in the upside of the market. Yup... the sacrifice is that they have less downside protection when the markets do fall, so that's a trade-off. And I wouldn't confuse a pure covered call strategy with the often talked-about Split Share corporations, which are a different beast altogether. I did put a video out a while back on split shares attempting to explain the workings of that type of investment, both the positives and the negatives. Only mentioning this because when we hear 'high income' a lot of investors default to that type of structure. Last point is that it also depends upon the need of the investor, so sometimes generating the stronger distribution is a main goal. And like you say, ALWAYS consider total return. At least to me, that's the most important thing. Thanks for watching and for taking the time to comment. - Marc
@@beaviswealth Thanks for the smart, well thought out, and very thorough response to my question. I will definitely consider some of your ideas to help diversify my portfolio as I am very focused on Canadian stocks because of the dividend tax credit.
To add what Marc said, looking at the "over all return" means you add up ALL the dividends you received and consider the increase or decrease of the price if or when you decide to sell it. What some people don't realize is to add up all the dividends as well. Sometimes it looks like you lost because the price dropped a lot, but if you held it for 5 yrs with monthly distributions you have 12 times 5 of dividend amounts to add up and total. Again, another angle that Marc could explain on his "to consider List" in helping us learn and have clarified. Good comment💯👍
Perfectly explained !
Thanks Sir for your explanation, as a canadian investor 5 years close to retirement what is your suggestions about these ETFs , what is the criteria about picking Canadian hedged or USD hedged ETFs , or in what type of account either TFSA or RRSPor Cash or it depends about the time when USDis more or CAD is stronger.
Thanks
Anil
Hi Anil. You ask great questions, but without knowing you and your financial circumstances, I couldn't really give you an answer that you could rely on. I'll always fall back to the concept of having a well diversified portfolio, and especially closer to retirement, a slightly more conservative makeup that you might find with a younger investor. Not 'under the mattress' conservative, but a portfolio with sufficient downside protection and probably income if you'll be drawing from it in retirement. Hedged of Unhedged is a personal choice in most cases. Most investors pick one of the other, and go with it. If you feel comfortable anticipating currency moves, you could move back and forth, but that's more challenging and in many cases might work against you. Hope that helps. Thanks for watching. - Marc
Great presentation. The ROI shown is very helpful. Much appreciated.
Glad it was helpful! Thanks for watching - Marc
thanks Marc for the information. Do you feel Harvest ETF fund management fee a bit higher? most of them close to 1%.
Hey Jeffrey. If you compare these to straight index funds, yes, the MERs will be higher. The added cost accounts for the covered call overlay. Thanks for the question. - Marc
When they say the video is sponsored by Harvest, does it mean that Harvest is paying a sum to Brandon/Marc to do the positive promotion of their products? Cause there is nothing to sponsor in a youtube video, as loading it on UA-cam is free. Just asking the question out of curiosity..
Hi Paritosh. Without getting into specifics, companies from time to time do provide compensation to UA-cam channels to highlight their service or products. In this case, Harvest has sponsored this video series and we're featuring their ETFs. Sponsored or not though, our goal is to educate our audience and hopefully the information in the video did that.
. Hope that helps! - Marc
@@beaviswealth makes sense, appreciate the response!
Awesome video, more like these! Very detailed and informative!
Thank you Brian. I appreciate that. - Marc
you just rock. Thank you Sir.
Thanks. - Marc
I know is 9 months but what was the MER on each of these?
Awesome post! Can you provide your opinion to other similar covered calls such as. Hamilton’s hyld. Is there a reason to consider Harvest products over Hamilton’s?
Hi Shafiq. Thanks for watching the video. I'd expect that we'll continue to cover other ETF provider's funds as time goes by... I'm not totally up to speed with Hamilton's lineup, but as for Harvest, I truly love the way they manage money and it falls pretty much into line with how I've managed my own portfolio for many years, so it's easy for me to like what they do. Not really picking on above the other, because there are lots of good funds out there. Appreciate the comment and question. - Marc
Thank you for the suggestions. I own some Harvest products myself. However I do have a question. Because these etfs cover the diversification subject well, where do you see allocation of these 5 etfs in ones retirement portfolio. I doubt it would be equql parts as a 20% allocation of HHL or HTA can be way too much. Thoughts please ?
That's a good question, Roger, but it's specific to each investor. Depending upon your personal circumstances, you'd calculate what mix is right for you. You're on the right track, identifying that each of these ETFs will behave differently due to the industries they operate in. Cheers. - Marc
Great video as always. Since there funds are well diversified what percentage of a portfolio would be appropriate?
The % would be unique to each investor, depending on your overall investing objectives. Hope this video gave you some food for thought. Cheers. - Marc
How much should someone have in a tfsa in the market by retirement ?
Depends on your goals and personal circumstances. - Marc
Looking forward to seeing you and Brandon at The MoneyShow in Toronto this weekend!
That's awesome! We're looking forward to the event... see you Friday! - Marc
Hey there Mark! I have been thinking about you wondering what your next topic will be and where you were. Glad to see you and on a topic of relevance! I am slowly buying ETF's and split corps now, along with maintaining the individual stocks I have had for decades...with all nice capital gains and good dividend payers.....because I am a long time passive income investor💯
So nice to have this topic covered and to have you "back on the tube" again. I so enjoy your presentation persona and your choice of topics. You keep things honest and grounded without coming across as if you know everything even though you have decades of experience. There is a saying, the longer I live the less I know. You come across in a humble way. This adds confidence in what you are teaching us or bringing to our attention to give us more food for thought. Cheers from Altantic Canada👍🇨🇦
Thanks so much, and we always appreciate your in-depth comments. I've been mostly away from UA-cam for the past while for various reasons, but love putting the videos together and look forward to more in the weeks to come. From the Pacific to the Atlantic, have a super day. - Marc
@@beaviswealth Whenever you are ready, a lot of us are here waiting. You know what they say, "Absence makes the heart grow fonder!"😊👍🇨🇦, from Atlantic to Pacific, great to have you back on the tube.💯
one of your better posts certainly
Thanks, Tim. Appreciate you watching. - Marc
Why dont go all in VDY then, on 30, 40 years with will have a good mix of growth and income?
The easy answer is that putting 80% of your money into only two sectors, all in one country, isn't a good idea. - Marc
Cant argue with that, thx.
What happens when these calls get exercised, which erodes the dividend-generating holdings?
When calls are exercised, the price has risen and it will ultimately suppress the upside of a portfolio. The expertise of the fund manager will make a huge difference in this regard. Also, as you note, if a stock is called away, so are any dividends. That's one of the reasons I do like the limit of 33% for call options on these funds. Thanks for your comment. - Marc
Thanks so much again, Marc, for another very well made and explained video!
Thanks a ton. - Marc
Is this dividend or is it distribution? Maybe we should have a new video differentiating the both including when filing taxes
Good suggestion for a future video. The terms are often used synonymously, but as you note, they can be different. In this case, the distribution is a combination of dividends, income and in some cases, return of capital.- Marc
I like HHL, own it... I dont like HUTL not enough liquidity, barely trades any shares, you cannot buy and type of quantity.. I prefer ZWU. It also has a longer track record... also some of the harvest funds mentioned here have not been around long, HLIF for example is less than 6 months old.. and I prefer companies that have proven track records and enough volume that if you want or need to get out, or in you can do so easily.
Thanks for sharing your thoughts. I'd argue that this combination of funds makes a reasonable portfolio, but obviously that's subjective. Appreciate you watching. - Marc
@@beaviswealth just hard to get in and out of some lower volume ETF's like those you mention when you want to buy or sell 25k shares is all I mean.. I like the harvest products though, good quality.
Great video!!
Thanks! - Marc
These covered calls etfs are really good now in down and side ways market
Get paid waiting for next bulls market in your portfolio
Liked 👍 Thanks
Thanks, Owen. - Marc
Hola Marc, en verdad este video me interesó mucho, por los dividendos de HTA y HHL, creo que es un buen momento para comprar HTA considerando la reciente caida y luego HHL, la área de cuidado en salud me parece muy lucrativa y estable, ademas de pagos mensuales, probablemente estaré invirtiendo los divindos en estos ETFs hasta que revalance el portafolio
"Hi Marc, this video really interesting me a lot, due to the HTA and HHL dividends, I think it's a good time to buy HTA considering the recent down and then HHL, the healthcare area seems very lucrative and stable, also of monthly payments, I'll probably be investing the dividends in these ETFs until I rebalancing my portfolio."
Gracias, Juan. - Marc
So this was basically a 22 minute ad. At least give people some simulation or expected income, talk about the risk, talk about their all in one hdif fund, addresa the potential downside of such strategy... Not much value added other than advertising the funds
Howdy Ayman. While featuring Harvest ETFs, I hope I provided some solid information on the things one should consider when constructing a portfolio. Agree that there are a million things to factor in, but couldn't cover them all in one video. Hopefully, when viewed along with all our other postings, our viewers can formulate a complete picture. - Marc
These 5 picks have a total Average MER of .992% Seems high.
The management fees are higher than a straight index fund, for sure. I'd say the fees are in line with other ETF providers which follow the same covered call overlay... which adds costs to running the fund you wouldn't get with a passive index fund. Hope that makes sense. - Marc
The management fees are too high….
Subjective, I suppose. Compared to a pure index fund, they are higher. When you factor in the cost of the covered call strategy, you might argue otherwise. But ya.... it's always important to make that judgement and weigh the benefits.. Thanks. - Marc
Thank you Mark! What % of each of these ETF would be recommanded to hold in a retirement portfolio
You're welcome, Maude. I wish I could give you percentages, but that really comes down to each individual investor, and without knowing your specific circumstances I couldn't recommend a mix for you personally. I'd always say, and especially in retirement, you need to have a well balanced portfolio. - Marc
Great stuff!
Thanks, as always! - Marc
Hi Marc, does any of the Harvest ETF use modest leverage? Could you comment on how risky the leverage could be when there is an enormous market down turn?
The funds I covered in this video do not use leverage. Their fund of funds, HDIF, does use modest leverage, around 1.25. Any time leverage is involved, there is a compensate amount of risk added. Should enhance returns in up markets, and hurt in down markets, as you suggest. Thanks for asking! - Marc
Thank you so much for that clear explanation of covered calls- I'm no longer confused lol
Glad to hear it helped clear things up, Suzanne. Cheers. - Marc
Great content as always Mark! Do they write options on 33% of their holdings per year? And are they at the money or out of the money options?
Thanks, Jay. The 33% max is at any given time, but subject to the fund managers' discretion. They can actually have a 0% position if they choose. Not sure what price points they buy at... I'd imagine it changes depending upon market conditions, but can't say 100%. - Marc
I communicated with Harvest recently. They had written covered calls on only 22% of HTA at the time. Just an example.
How about hlif canadian equities etf. New
Stay tuned... upcoming video on HLIF. - Marc
great video Marc!! good knowledge
Thanks... and thanks for commenting! - Marc
love this, thanks for the wealth and quality of information
Thank you.... really appreciate that. - Marc
Great input!
Thanks, Isaiah. - Marc
Follow passive income instead. Adriano has been talking about this for years while these guys were talking about single stocks lol
We've never talked about single stocks, we've always talked about a PORTFOLIO of stocks, comprised of individual securities, yes, cause that's how you do it. Big difference. And we've posted a ton of videos about ETFs as well. Different strokes for different folks.
Yes, key word at the beginning of the video is that it's sponsored. Still this is a lot better content then pumping TD credit cards.
Thanks for watching. Not sure why you're so convinced that we're 'pumping' anything for TD, because we're not. Any sponsored content is always described as such. - Marc
Hi Kirk, yes, Adriano talks about split corps and cover call ETF, Harvest and Middleton management companies. Adriano is all in for no individual stocks. I would like to point out that he also has said that "Diversification is King." And if you believe in that then it is perfectly diversified if you hold BOTH individual stocks and ETFs and split corps. Its called a hybrid portfolio. There are really nice individual stocks that are "aristocrats" with high dividends and with preferential tax treatment. PLUS some of these wonderful individual stocks are NOT represented in what Adriano keeps promoting. So, yes, more diversification if you hold individual stocks that pay dividends and have a history of increasing their dividends, and ETF's and split corps. Diversification is King....right???? Different strokes for different folks....and FYI, long before ETF cover calls and split corps came out I was doing really well with these dividend paying stocks that pay nice dividends .... so please, don't knock us individual stock holders down when so many of us are millionaires and retired at 45 yrs of age. Keep an open mind, keep evolving, and you will be OK👍🇨🇦
Isnt this passive income?