Precision investment engineering
with BMO Enhanced Income Equity ETFs

Our Enhanced Income Equity ETFs offer equity exposure to three major market indices, utilising covered call options to provide an enhanced, sustainable yield and a smoother return profile than their respective index.

•             BMO Enhanced Income UK Equity UCITS ETF

•             BMO Enhanced Income Euro Equity UCITS ETF

•             BMO Enhanced Income USA Equity UCITS ETF

BMO ETFs are carefully constructed to target desired levels of income and risk, helping you achieve diversification and stability of income in your portfolio with precise investment engineering. Our enhanced income strategy looks to achieve index like returns over the long term, with reduced volatility and higher yield. We target a yield enhancement of 2 – 4% over the chosen equity benchmark across our suite.

In the UK the three new ETFs increase our product range in EMEA from 10 to 13 funds. As a global asset manager we continue to seek opportunities to leverage on our successes across all markets.

Our ETF investment specialists

We launched our first ETF in Toronto in 2009 and we have over 100 ETF listings globally, with £23.5bn assets under management across our Systematic and ETF strategies (as at 31 May 2017). We became the first Canadian bank to offer ETFs in Europe with the launch of our European range in November 2015. With the addition of the new Enhanced Income ETFs, the range now comprises 13 ETFs listed on the London Stock Exchange.

Terry Wood

Terry Wood, CFA

Head of ETF Portfolio Management (EMEA)

Alex Jones

Alex Jones

Director, Portfolio Manager, Exchange Traded Funds

Chris Mchaney

Chris Mchaney, CFA

Vice President, Portfolio Manager
Global Structured Investments

Our investment objective

Watch our video to learn more

Investors are looking for alternative ways to generate sustainable income without taking on additional risk. Enhanced Income Strategies, also known as covered call strategies, are efficient solutions that can add income to a portfolio without increasing the equity risk.

ETFs are an efficient way to access an enhanced income strategy combining passive equity portfolio management and a rules-based options overlay methodology, at a low cost.

BMO Enhanced Income Equity ETFs provide equity exposure with a sustainable attractive yield and lower volatility than a traditional market capitalisation weighted index.

Our distinctive strategy

Register for our live webinar

Henry Cobbe, Head of Research at Elston Consulting, and Morgane Delledonne, ETF Investment Strategist at BMO Global Asset Management, assess and debate the characteristics of ETFs available to UK investors seeking higher than average income levels. Morgane also introduces the BMO Enhanced Income Equity ETFs.

The Enhanced Income strategy is implemented by selling call options on the index, while owning the underlying stocks. This allows the portfolio to generate income from the written call option premiums in addition to the dividend yield from the underlying stocks. Option-based strategies take advantage of the supply-demand imbalance that exists between investors looking to hedge their equity positions and the lower number of hedge providers. This allows the fund to harvest the volatility risk premium and generate income for investors while managing the downside risk.

Historically, covered call strategies have provided a similar long-term performance to the broad market with lower risk.

For further information on our BMO Enhanced Income Equity ETFs.
Download our sales aid here .

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