TSX ETF Investor Centre
Income & Growth - The Key To Retirement
Covered call strategies allow investors to enhance the level of cash flow in their portfolio making them an effective solution for retirees. However, there are very different approaches to covered call writing and different trade-offs that investors should be aware of.
Come see how BMO approaches the traditional trade-off between growth and income, with our decade of experience giving you back more growth potential, while still maintaining a high level of stable cash flow to meet your lifestyle needs.
Choosing the Right Covered Call Strategy
Covered call funds have become popular in recent years as investors look for higher yielding investment strategies to add to their portfolios. A covered call option strategy involves investing in a portfolio of stocks and then selling call options on the same stocks that are held in the portfolio. This strategy allows a fund to generate additional income from the premiums received when selling call options, which reduces the volatility of the portfolio and allows the fund to pay out higher distributions than it would otherwise be able to do.