Topic: How To Invest

Q: Pat: What do you think about the Evolve Global Healthcare Enhanced Yield Fund? It’s a health company-focused ETF. Thanks.

Article Excerpt

A: Evolve Global Healthcare Enhanced Yield Fund, $22.85, symbol LIFE on Toronto (Units outstanding: 5.3 million; Market cap: $121.1 million; www.evolveetfs.com), aims to track the Solactive Global Healthcare 20 Index Canadian Dollar Hedged Index. LIFE invests primarily in the stock holdings of that index. The fund also writes covered call options on up to 33% of its portfolio securities. Note, the level of covered call option writing may vary based on the fund managers’ analysis of market volatility and other factors. The ETF launched on October 25, 2017. Its MER is 0.45%. The fund holds 21 equally weighted stocks. They include Eli Lilly, AstraZeneca, AbbVie, Danaher Corp., CSL Ltd., Pfizer, Intuitive Surgical, Novartis AG, Roche Holding and GlaxoSmithKline. We have a favourable opinion of some of the stocks that the ETF holds, and its yield is very high at 6.6%. However, the ETF may find it difficult to maintain that payout. That’s because the dividend income from LIFE’s portfolio falls short of the fund’s cash…

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