By Ambrose O’Callaghan
Leadership inspires, influences, and empowers others to grow and meet a shared goal. Being a leader is in your DNA. It is in a proven track record that imbues trust.
Harvest Income Leaders ETFs invest in those leaders that have defined the market. These are quality businesses that are widely known and have demonstrated their ability to adapt and dominate their respective industries.
“We believe long-term investment in great companies is one of the best ways to build wealth,” says Harvest ETFs Co-Chief Investment Officer -James Learmonth, CFA. “Income Leaders ETFs are built on this belief, investing in companies that are among the dominant players in their respective fields, while providing monthly income supported by an established active covered call strategy.”
Picking the leaders
Income Leaders™ target strong businesses that can adapt and innovate in their respective industries. These ETFs offer access to sectoral themes like healthcare, technology, utilities, and more. Let’s examine why we target these sectors, what makes them stand out, and how Income Leaders™ ETFs deliver exposure with monthly income.
Healthcare
Healthcare stands apart as an essential, diversified, and innovation-led sector. The Harvest Healthcare Leaders Income ETF (TSX: HHL), Canada’s largest healthcare ETF – now over $1.8 billion in AUM – is designed to capture exposure to the healthcare space through twenty large-cap healthcare leaders. HHL boasts a 10+ year history, paying consistent monthly cash distributions every month over its lifespan.
There are three permanent, non-cyclical drivers that underpin the long-term outlook for the healthcare sector going forward:
- Aging Demographics: The 65+ demographic is set to double from 2024 to 2054. As populations age, healthcare spending increases exponentially
- Technological Innovation: New technologies ranging from GLP-1 therapies, wearable health monitoring, robotic surgeries, and more
- Developing Markets: As wealth rises in emerging economies, healthcare spending will also increase disproportionately
HHL provides diversified exposure across healthcare sub-sectors. Long-term drivers are shared across those sub-sectors, but short-term catalysts often differ. This helps to smooth the overall experience when specific policy or regulatory concerns arise that impact a particular area more than another.
The Harvest Healthcare Leaders Enhanced Income ETF (TSX: HHLE) provides access to the same portfolio of healthcare leaders and applies modest leverage of approximately 25% to enhance its monthly cash distributions, as well as its growth potential.
Technology
Investors perception of the technology space has undergone a shift in 2026. Artificial intelligence was the dominant story that drove growth through 2024 and 2025. Today, investing in technology is no longer about betting on future breakthroughs, it is a play on the monetization of AI infrastructure going forward.
Technology is a diverse sector with many growth factors, but AI remains a significant story at this stage. Hyper-scalers like Microsoft, Google, Amazon, and Meta have committed hundreds of billions in annual capital expenditures to data centres, graphics processing units (GPUs), and model infrastructure. Moreover, AI spending broadens beyond mega-caps into areas like edge compute, cybersecurity, and more. The value of global IT is projected to exceed $6 trillion USD in 2026.
The Harvest Tech Leaders Income ETF2 (TSX: HTA) is designed to provide exposure to global large-cap technology companies that dominant this fast-growing space. HTA boasts a track record over a decade old, delivering consistent, high monthly income every month over that span. Better yet, HTA has increased its monthly cash distribution six times since inception.
For investors seeking even higher levels of income, the Harvest Tech Leaders Enhanced income ETF7 (TSX: HTAE) applies modest leverage to an investment in HTA, seeking to generate even higher levels of monthly income and growth potential.
Utilities
Utilities services, like lighting, heating, and water, are provided and paid for by all citizens. These essential services are made available and consumed regardless of market and economic conditions. Owning utilities stocks continues to be a good defensive posture for a portfolio. However, having the right exposure mix is what is crucial.
The Harvest Utilities Leaders Income ETF3 (TSX: HUTL) provides investors access to powerful trends in the utilities space. That includes the growth of generative artificial intelligence, and the explosion of energy demand it has sparked. In a November 2025 research note, Goldman Sachs projected that data centre power demand could increase 175% by 2030 compared to the levels seen in 2023. That is the equivalent of adding another top 10 power consuming country to the planet.
Energy Consumption of Generative AI Models
Source: “Generative AI: Energy Consumption Soars”, Polytechnique Insights. November 13, 2024.
As a result of this phenomenon, data centre demand is growing steadily. Data centre markets are concentrated heavily in the United States, Asia, and Europe. HUTL is unique in that it focuses on a portfolio of global utilities, providing access to this fast-growing space.. A global utilities portfolio provides geographic diversification, which can help reduce exposure to region-specific regulatory environments and localized natural disaster risks.
Investors who want even higher levels of income and growth potential may want to consider the Harvest Utilities Leaders Enhanced Income ETF8 (TSX: HUTE). HUTE offers exposure to the same portfolio of global utilities and a covered call strategy, while employing modest leverage at approximately 25%.
Industrials
The outlook for the industrials sector is supported by renewed U.S. manufacturing activity. This is consistent with conditions observed in the spring of 2024.
The industrials sector is made up of industries that are involved in the production and processing of raw materials, goods, or services. In terms of the Harvest Industrial Leaders Income ETF (TSX: HIND), this includes a range of sub-sectors:
- Aerospace & Defence
- Trading Companies & Distributors
- Electrical Components & Equipment
- Rail Transportation
- Industrial Machinery & Supplies & Components
Industrials are no longer a slow-growth, legacy sector. This space now stands as a key engine of economic transformation in the U.S. These benefits are rooted in developments like the post-pandemic reshoring trend, infrastructure stimulus through key legislation, and a manufacturing technology boom.
Deloitte writes that chip sales are poised to soar in the middle of this decade. This is occurring on the back of generative AI and data centre build outs. A February 2026 report projected that the semiconductor industry could reach US$2 trillion by 2040.
HIND has 20 equal weight industrials securities. It offers exposure to these leading industrial companies and the emerging trends that are powering their growth. Moreover, it offers up sector diversification within the industrials space to reduce portfolio volatility.
US Banks
The United States continues to harbour many of the world’s largest and most dominant financial institutions. While uncertainty persists in the broader economy, many of the top US banks have continued to deliver impressive earnings in the first quarter of 2026. Some of the highlights that have continue to drive optimism in this space:
- Resilient Margins: Net interest margins remain robust, further validating the strength of the US market recovery
- Regulatory Sentiment: Names like Wells Fargo are benefiting from improving regulatory sentiment and expanding margins
- Trading Strength: Goldman Sachs, a dominating force in the world of trading, has demonstrated resilience across diverse revenue streams
- Capital Returns: Citigroup has reinforced shareholder confidence with multi-billion-dollar buyback programs in recent years
The Harvest US Bank Leaders Income ETF (TSX: HUBL) holds these US bank leaders and utilizes an active covered call writing strategy to enhance monthly income. HUBL pursues a core, dividend-paying US financials equity portfolio of large-capitalized US banks and financials stocks.
Investing in Canada
Canada is still an attractive investment destination. The country is built on a foundation of abundant natural resources and highly competitive industries with oligopolistic characteristics. These include the big six banks, energy producers, utilities, telecom providers, and a growing technology ecosystem.
Top Canadian companies that boast long histories of dividend growth can be found in the Harvest Canadian Dividend Leaders Income ETF6 (TSX: HLIF). This ETF aims to capture the powerful traits of Canada’s leading companies, combining them with an active covered call writing strategy to generate high levels of monthly cash distributions.
Dividend kings are equities that have delivered at least 50 consecutive years of dividend growth. These equities represent mature, financially stable businesses with strong competitive advantages. Their ability to deliver consistent income over many decades, spanning varying economic cycles, is illustrative of their durability. Dividend kings are the true cream of the crop of dividend payers.
In Canada, there are two dividend kings, and both are held in HLIF. Canadian Utilities Ltd, which has delivered 53 straight years of dividend growth, and Fortis, which has posted 51 consecutive years of dividend growth.
US Equities
The U.S. equity market is home to some of the world’s most iconic brands. These equities, and the companies they represent, stand out as bellwethers. World class businesses with large market capitalizations that can dominate the markets they compete in. These companies have demonstrated the ability to take advantage of down cycles and come out even stronger on the other side.
Lengthy dividend growth streaks are a sign of strength and quality. There are even more dividend kings in the U.S. market. Harvest US Equity Leaders Income ETF1 (TSX: HBF) HBF contains companies that have some of the longest and most impressive dividend growth streaks in the world. This includes companies like Procter & Gamble, with nearly 70 consecutive years of dividend growth, the Coca-Cola Company, which boasts 63 straight years of dividend increases, and more.
HBF is an equally weighted portfolio that comprises 20 large-cap companies selected among the leading corporations in the United States. The ETF is designed to provide consistent monthly income with an opportunity for growth.
Summary
Harvest Income Leaders ETFs invest in market leaders. These are quality businesses that are widely known, and able to adapt and dominate their respective industries. Several names among Harvest Income Leaders™ ETFs – including HHL, HBF, and HTA – have over a decade-long track record in delivering consistent, and growing income. The suite also includes ETFs like the Harvest REIT Leaders Income ETF4 (TSX: HGR), the Harvest Travel & Leisure Income ETF (TSX: TRVI), and the Harvest Low Volatility Canadian Equity Income ETF (TSX: HVOI).
Learn more about our Harvest Income Leaders™ ETF suite here.
Disclaimer
This communication should not be considered as advice and/or a recommendation to purchase or sell the mentioned securities or used to engage in personal investment strategies. Tax, investment and all other decisions should be made with guidance from a qualified professional.
Commissions, management fees and expenses all may be associated with investing in Harvest Exchange Traded Funds managed by Harvest Portfolios Group Inc. (the “Funds”). Please read the relevant prospectus before investing. The Funds are not guaranteed, their values change frequently, and past performance may not be repeated. Distributions are paid to you in cash unless you request, pursuant to your participation in a distribution reinvestment plan, that they be reinvested into available Class units of the Fund you own. If a Fund earns less than the amounts distributed, the difference is a return of capital.
The Funds that use modest leverage of 25% do so to enhance exposure, directly or indirectly, to the underlying stocks. This places them within the category of liquid alternative ETFs. The use of leverage increases the return volatility, meaning it will amplify both gains and losses.
Certain statements included in this communication constitute forward-looking statements (“FLS”), including, but not limited to, those identified by the expressions “expect”, “intend”, “will” and similar expressions to the extent they relate to the Fund. The FLS are not historical facts but reflect Harvest’s, the Manager of the Fund, current expectations regarding future results or events. These FLS statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. Although Harvest, the Manager of the Fund, believes that the assumptions inherent in the FLS are reasonable, FLS are not guarantees of future performance and, accordingly, readers are cautioned not to place undue reliance on such statements due to the inherent uncertainty therein. Harvest, the Manager of the Fund, undertakes no obligation to update publicly or otherwise revise any FLS or information whether as a result of new information, future events or other such factors which affect this information, except as required by law.
