Exploring the Harvest Diversified High Income Shares ETF (HHIS): All-in-One Covered Call Series
If you’re seeking a reliable way to generate income from your investments, the Harvest Diversified High Income Shares ETF (HHIS) could be a great option. This exchange-traded fund (ETF) uses a covered call strategy to provide investors with high monthly income. Let’s dive deeper on what makes this ETF unique and why it might be a good choice for your portfolio.
What is HHIS?
The Harvest Diversified High Income Shares ETF (HHIS) aims to offer high monthly income and growth potential by investing in a diversified selection of single-stock ETFs. These ETFs focus on leading companies in various sectors, including technology, healthcare, and finance. The fund generates additional income by employing a covered call strategy, where it sells call options on the stocks it holds. This generates premium income, which adds to the overall returns of the fund.
Portfolio Holdings
HHIS holds a mix of Harvest’s single-stock ETFs, each targeting a specific company. As of January 31, 2025, the holdings were:
These holdings provide diversified exposure to leading companies across several key sectors. However, remember one thing: The total holding here are only 9 companies. As compared to the other all-in-one etfs we have covered, this all-in-one is the least diversified. In return, the fund offers the highest monthly yield when compared to other all-in-one etfs from Hamilton and BMO.
Monthly Distributions
One of the main draws of HHIS is its ability to provide investors with consistent monthly income. The ETF distributes C$0.25 per unit every month, making it an attractive option for those seeking regular cash flow. The most recent distribution was announced on February 14, 2025, with a payable date of March 7, 2025.
Performance Metrics
• Net Asset Value (NAV): As of February 14, 2025, the NAV stood at C$13.31.
• Assets Under Management (AUM): As of February 14, 2025, the fund has C$100.16 million in assets.
Key Features
• Diversified Exposure: HHIS provides exposure to a diverse range of sectors, including technology, healthcare, and finance, by investing in single-stock ETFs.
• Covered Call Strategy: The ETF enhances its income through an active covered call strategy, which can boost monthly distributions.
• Leverage: Some of the underlying ETFs in HHIS use modest leverage to help increase potential income and growth.
Risks and Considerations
While HHIS offers attractive monthly distributions, there are some factors to keep in mind:
• Market Volatility: As with any equity investment, the value of HHIS can fluctuate depending on market conditions.
• Covered Call Limitations: The covered call strategy can limit the upside potential of the underlying stocks if they experience significant price increases.
Final Thoughts
The Harvest Diversified High Income Shares ETF (HHIS) offers a compelling option for income-focused investors. With its monthly distribution of C$0.25 per unit, diversified exposure to top companies, and the added income from a covered call strategy, it’s an appealing choice for conservative investors seeking steady cash flow. However, it’s important to understand that market volatility and the limitations of the covered call strategy could affect the fund’s performance.
Before making any investment decisions, it’s always a good idea to speak with a financial advisor to ensure that HHIS fits your investment goals and risk tolerance.