Description

The BMO Covered Call U.S. Banks ETF is structured to give investors exposure to a collection of American banking sector equities, while simultaneously generating revenue through the sale of call options. The fund directly purchases shares of U.S. banks and then sells covered call options against these assets. These call options are typically chosen with strike prices above the current market price (out-of-the-money) and are selected after evaluating their implied volatility. The premiums received from selling these options offer a degree of protection against potential declines in value. The portfolio's underlying stock composition is adjusted and updated biannually, specifically in June and December, with expiring options being systematically replaced with new ones.