Fixed Income ETFs
Investment Philosophy
Harvest Fixed Income ETFs offer investors exposure to investment grade fixed income in two ways (1) by investing in a portfolio of US Treasury ETFs overlayed with a covered call option strategy; and (2) by investing directly in short-term Government of Canada treasury bills. Combining cashflows from a portfolio of US Treasury ETFs with a covered call option strategy aims to generate higher income for investors. Our short-term ETF is a cash-proxy vehicle that aims to meet investors’ needs for liquidity in the short term while generating income.
Investment Process
Portfolio: US Treasury ETFs
US listed Treasury ETFs selected for liquidity, options and long duration.
Active Covered Calls
Using Harvest’s covered call strategy, target a 75% baseline write level and adjusting to market conditions for set distributions.
Ongoing Monitoring
Constantly assess premium capture, early cover chances, and rate-driven upside, while stresstesting distribution for sustainability metrics.
Monthly Income
Tax efficient distributions paid monthly.
An Established Process
The active covered call option strategy employed at Harvest stands as an established approach for generating monthly cash flow, backed by a proven track record. Our Covered Call ETFs consistently distribute income monthly. The Investment Management Team, with decades of combined investment management experience, effectively implements and executes this strategy.
Equity Income ETFs
The Harvest investment philosophy is premised on investing in high-quality companies, with strong businesses offering steady growth. To provide an attractive income, we use a covered call option strategy to enhance the natural dividend yield of the portfolio and may reduce some of the volatility associated with equity investing. Using proprietary models, the investment management team will assess the various positions in the portfolios and corresponding premiums in order to write the required amount of options to generate the premium income.