In this episode, host Zayla Saunders sits down with Roxane Lapenna to break down the mechanics behind the covered call ETF shelf: from option premium and cash flow generation to the realities of NAV erosion and what it all means for yourportfolio.
Zayla Saunders is Vice President of ETF Online Distribution at BMO Global Asset Management (BMO GAM). She is joined by Roxane Lapenna, Head of Retail Investment Specialists at BMO GAM. This episode was recorded live on April 27, 2026.
ETFs mentioned:
· BMO Covered Call Canadian Banks ETF (Ticker: ZWB)
· BMO Covered Call Canadian Banks ETF (Target Cash Flow Units) (Ticker: ZWB.T)
Sources:
ETF Flows, according to the National Bank Report, February 2026
Press Release - February 12, 2026 - BMO Expands ETF Lineup with New Target Cash Flow Units
BMO ETFs launched the first covered call in Canada in 2011
Distribution Yield: The most recent regular distribution, or expected distribution, (excluding additional year end distributions) annualized for frequency, divided by currentnet asset value (NAV).
Strike price: The price at which the underlying security can be either bought or sold once exercised.
At-the-money: Having a strike price that is equal to the current market price of the underlying holding.
Out-of-the-money: How far the strike price is set relative to the underlying stock price.
T Series - Target Cash Flow Units of BMO ETFs: The Target Cash Flow Units of certain BMO ETFs are designed to provide investors with a monthly distribution based on a target annual distribution rate which is based on the NAVPS at the end of the prior year, or in the case of a newly created series, based on a target annualized distribution rate which is based on the initial starting NAVPS.
Disclaimers:
Please visit for full disclaimers
This podcast is for information purposes. The viewpoints expressed by the speakers represent their assessment of the markets at the time of publication. Those views are subject to change without notice at any time. The information contained herein is not, and should not be construed as, investment, tax or legal advice to any party. Investments should be evaluated relative to the individual’s investment objectives and professional advice should be obtained with respect to anycircumstance.
Any statement that necessarily depends on future events may be a forward-looking statement. Forward-looking statementsare not guarantees of performance. They involve risks, uncertainties and assumptions. Although such statements are based on assumptions that are believed to be reasonable, there can be no assurance that actual results will not differ materially from expectations. Investors are cautioned not to rely unduly on any forward-looking statements. In connection with any forward-looking statements, investors should carefully consider the areas of risk described in the most recent prospectus.
Commissions, management fees and expenses all may be associated with investments in exchange-traded funds. Please read the ETF Facts or prospectus of the BMO ETFsbefore investing. Exchange-traded funds are not guaranteed, their values change frequently and past performance may not be repeated.
For a summary of the risks of an investment in the BMO ETFs, please see the specific risks set out in the BMO ETF’s prospectus. BMO ETFs trade like stocks, fluctuate in market value and may trade at a discount to their net asset value, which may increase the risk of loss. Distributions are not guaranteed and are subject to change and/or elimination.
BMO ETFs are managed by BMO Asset Management Inc., an investment fund manager, a portfolio manager, and a separate legal entity from Bank of Montreal.
BMO Global Asset Management is a brand name under which BMO Asset Management Inc. and BMO Investments Inc. operate.
“BMO (M-bar roundel symbol)” is a registered trademark of Bank of Montreal, used under licence.