Monthly ETF Commentary

February 2026

Harvest ETFs kicked off the New Year with a slew of announcements in the month of January.

First, across our core equity income suite, we announced 10 distribution increases. Many of these ETFs have now achieved over 10 years of consistent and growing monthly distributions. This underscores the durability of these strategies.

We launched the Harvest Premium Yield ETF suite: The Harvest Premium Yield Canadian Bank ETF (TSX: HPYB), and the Harvest Premium Yield Enhanced ETF (TSX: HPYE). HPYB and HPYE are the first Harvest ETFs to pay income twice monthly to unitholders.

Moreover, we launched six new High Income Shares ETFs™. This includes several widely held core names, like CrowdStrike and Johnson & Johnson, alongside higher-growth opportunities.

Our largest ETF, and the largest Healthcare Income ETF in Canada – the Harvest Healthcare Leaders Income ETF (TSX: HHL) – received the FundGrade A+ Award. Keep an eye out for additional healthcare commentary in the month ahead.

Finally, the Harvest Diversified High Income Shares ETF (TSX: HHIS) marked its one-year anniversary. HHIS rose above $1.3 billion in assets. We recently published a deep-dive review that highlights the portfolio evolution of HHIS, including two distribution increases over the past year. The piece also provides a forward outlook for HHIS.

Market breadth persists

Technology continued to lead markets throughout 2025. However, an important development was the broadening of participation. At the end of the previous year, all sectors had finished in the black, even as some defensive areas lagged.

The month of January kicked off with mixed sub-sectors performance. Consumer staples saw relative outperformance but still fell behind the broader market. Notably, it was a very strong month for the Harvest Energy Leaders Plus Income ETF (TSX: HPF). HPF was powered by its exposure to dominant names like Suncor, Exxon Mobil, and ongoing geopolitical developments. The energy sector saw increased activity. Some energy stocks rose following the U.S. military operation in Venezuela, that saw U.S. forces abscond with then-President Nicolás Maduro.

Market strength also extended into the materials space, as precious metals continued to surge to start the New Year. This benefited the Harvest Global Gold Giant Index ETF (TSX: HGGG), our low-cost global equities ETF. Indeed, safe-haven demand has continued to surge amid heightened geopolitical tensions. World leaders traded speeches at the World Economic Forum in Davos, shining a spotlight on issues surrounding sovereignty, Greenland, and European tariffs.

By contrast, there were pullbacks in financials and technology. This leads us directly into earnings season, where we can highlight the continued importance of market breadth.

Earnings season & divergent banks

U.S. banks kicked off earnings season, reinforcing a theme we have seen across the markets. Roughly 40% of companies reported at the time of recording, and results have been explicitly bifurcated.

Large money-centre banks delivered solid results in the final quarters of 2025. However, their stocks pulled back. By contrast, several regional banks, including the M&T Bank and Citizens Financial, reached new all-time highs in the month of January. Given the heavy index weights of large banks, this dynamic tends to favour equal-weight exposures in the near term. The Harvest US Bank Leaders Income ETF (TSX: HUBL) offers exposure to a core dividend-paying US financials equity portfolio that is equally weighted.

Turning to Canada, bank earnings will report later in the month of February. The Harvest investment team maintains a constructive outlook on the Canadian banking group, while acknowledging the strong run over the past year. This backdrop makes the recent launch of HPYB timely. HPYB holds all six Canadian bank stocks. HPYB utilizes written puts and call options to generate income that is paid twice, every month.

Overall, earnings trends remain supportive in the banking space. However, we continue to expect ongoing volatility.

Technology highlights

Within technology, earnings have generally been solid. However, leadership continues to rotate.

Equal-weighted technology indexes have meaningfully outperformed cap-weighted benchmarks. This has been driven by pullbacks in mega-cap names alongside improving breadth across the rest of the sector. This environment is well-suited to equal-weight exposure. The Harvest Tech Achievers Growth & Income ETF (TSX: HTA) provides access to an equally weighted portfolio of core US large cap technology leaders.

Microsoft declined double digits from the highs it reached in the late fall of 2025 heading into earnings. Other areas of tech performed strongly, with Texas Instruments, Applied Materials, and Micron all up 25-50% during the month of January. This helped push HTA into positive territory.

Some of the mixed market reactions during the tech earnings season reflect our broader macroeconomic view. Earnings growth remains intact, inflation is near target, and U.S. economic data continues to resemble a Goldilocks environment. Of course, policy risks remain elevated for the present.

Conclusion

We reiterate our barbell approach as we move into February. That involves maintaining exposure to higher-growth areas while balancing elevated valuations with defensives and income. Our team advocates buying the dips, selectively adding to growth as volatility emerges, and taking advantage of pockets of relative value to build more resilient portfolios.

Harvest Healthcare Leaders Income ETF

We are delighted that HHL has received the Fund Data A+ award for 2025.

Healthcare sustained its recovery through January, emerging as a primary beneficiary of a rotation out of mega-cap tech and into high-quality defensive growth. The sector also saw relatively strong ETF inflows in the U.S., with other technical indicators shifting the group into an improving relative market position for the first time since early 2025. 

Sentiment was bolstered following a deal between major pharma issuers and the U.S. administration: companies agreed to lower select U.S. drug prices in exchange for exemptions from sweeping healthcare tariffs, providing some margin clarity that investors had been seeking. 

Like the broader markets, the divergence within the sector over the course of the past month has been wide.  Similarly, earnings season has been a source of volatility both to the upside and downside, even within sub-sectors. 

For example, Stryker was positive following strong earnings while Boston Scientific was under pressure, despite results that only modestly missed.

In Biopharma, it was Amgen that saw strong follow through post earnings while Abbvie lagged.  Large cap pharmaceuticals within the portfolio have performed relatively well across the board, including Merck and Bristol Myers – while there were several names not owned by the fund in the sub-sector that lagged.   Managed care stocks were under pressure towards the end of the month despite reasonable earnings, uncertainty persisted around the preliminary lower-than-expected Medicare Advantage rate increases, with final rates now expected in Early April.

The diversity within the portfolio was a highlight this past month, navigating through relatively volatile earnings season and we remained active across both the option strategy and utilized the movements in underlying stocks to tactically rebalance over the month.

Outlook | The long-term fundamentals of sector remain solid, driven by: Aging populations, developing nations, and technological innovation. HHL invests in 20 large-cap healthcare leaders, has an active covered call strategy, and pays a monthly distribution of $0.06 per unit. 

Harvest Brand Leaders Plus Income ETF

Following a volatile month for U.S. equities, HBF ended the month roughly flat on a total return basis.  Factors that impacted the ETF’s investments during January included:

• • Many sectors rallied during the month as investors positioned for a broadening rally in 2026, expected to be driven by fiscal stimulus from the One Big Beautiful Bill Act and monetary stimulus in the form of interest rate cuts by the U.S. Federal Reserve.
  • The Technology sector struggled, with weakness in software stocks as investors grappled with the perceived risk to incumbent providers from so called “vibe-coded” alternativesShares of Oracle Corp. fell during the month with ongoing concerns around the company’s use of debt to finance capacity expansions in its infrastructure-as-a-service business continuing to weigh on the stock. UnitedHealth Group Inc. also fell during month, along with managed care peers, after the U.S. Centers for Medicare & Medicaid Services (“CMS”) released an Advanced Notice for Medicare Advantage payment rates that proposed a net average payment increase that was significantly below market expectations. Shares of Caterpillar Inc. continued to rally strongly during the month, while Verizon Communications Inc. rallied sharply following a positive surprise in earnings.

The ETF maintained its covered call strategy, as it continues its focus on balancing income generation with participation in equity upside.  The ETF was rebalanced during the month of January but there were no changes to portfolio constituents.

Outlook | Ongoing macroeconomic and equity market valuation concerns have kept markets volatile | Equal weight and specific value-, quality- & yield-based financial metrics can help in current environment with ongoing rotations.

Harvest Tech Achievers Growth & Income ETF

HTA rose in January as investors rotated out of software and into Semiconductors and equipment.  Recent releases of a variety of software applications by private AI developer Anthropic reignited fears that incumbent software providers face significant competitive threats from so-called “vibe coded” solutions.

Software positions across the portfolio fell significantly during the month, but this was more than offset by strength in other areas of the portfolio, such as memory manufacturer Micron Technology Inc., semiconductor equipment producer Applied Materials Inc. and analog semiconductor manufacturer Texas Instruments Inc.

HTA uses covered calls to generate income while remaining positioned to capture growth potential in leading tech names.  The ETF was rebalanced during the month of January.  A position in creative software developer Adobe Inc. was replaced by a position in hard disk drive manufacturer Seagate Technology Holdings.

Outlook AI-driven tech demand continues | Equal weight can help to avoid over concentration I HTA is positioned in large-cap tech leaders and writes call options to support steady income.

Harvest Equal Weight Global Utilities Income ETF

HUTL turned in a very strong January. Some of the more important factors driving returns in January included:

• • European Utilities and Telecoms names witnessed many more of the standout performances during the month of January, with certain Canadian names notably on the less robust side of the spectrum – nonetheless, gains were good across the board.
  • Energy pipelines in North America looked strong, catching onto the rally in the Energy space, given the escalating tensions between the US and Iran.
  • Long bond yields were little changed, but remain closer to the 5% mark, and did not act as any headwind
  • The AI boom continues, which highlights growing electricity demand, offering a medium-term tailwind for a sector that tends to be low growth

HUTL’s portfolio of 30 top utility, telecom, and pipeline companies offers a balance of defensive income generation while capturing potential upside. The portfolio is supported by a covered call overlay to boost monthly cash flows.

The ETF will be reconstituted and rebalanced in February.

Outlook | HUTL is well-positioned in uncertain markets and for AI energy demand tailwinds I Can provide steady cash flow amidst broader macro uncertainty I HUTL remains a leading utility ETF in Canada.

Harvest Global REIT Leaders Income ETF

HGR gained on the month in line with the Global REITs sub-sector.  With little in the way of big changes to long-term bond yields, which remain below the 5% yield level on 30-year bonds, this helped to push real estate to shine more like a defensive sector versus the broader equity market, which exhibited volatility in January. Turning to some of the drivers during the month:

• • In the Healthcare sub-sector, after a wild 2025 for Welltower (not in HGR), there was a pullback in December and very little movement in January as investors digest very high valuations. Meanwhile, the names HGR owns, Healthpeak and Alexandria, capitalized on a bit of a bounce in January, driving relative outperformance for the fund.
  • The Office sub-sector also contributed to relative performance, with PSP Swiss Properties in Switzerland continuing to witness decent performance.
  • Offsetting some of this gain was the strong performance of Japanese and Hong Kong names for the Index, which generally fall into multi-asset conglomerates and developers, which are areas not generally investable for HGR

HGR remains broadly diversified across global REIT subsectors, offering exposure to a range of exposures like growth-oriented assets like industrials and data centers and value plays like office and healthcare REITs. This approach targets the management of macro uncertainty while targeting consistent income from global real estate leaders.

The ETF will be rebalanced and reconstituted in February.

Outlook | Global REITs have faced headwinds from higher yield concerns and macro uncertainty | HGR’s diversified tenant and lease exposure offers resilience I HGR is positioned to benefit from exposure to growth themes like data centers & online shopping trends with industrial warehouses globally.

Harvest Energy Leaders Plus Income ETF

HPF and broader Energy stocks witnessed a very strong January. Crude oil prices shot higher on two occasions during the month and helped to propel the energy equities higher.  The notable catalysts for the energy sector seemed to trade around:

• • Crude oil initially moved higher early in the month, as Iranian protests escalated, causing the US administration to initiate threats on the Iranian leadership about clamping down on protestors
  • Later in the month, as Trump talked about a “massive Armada is heading to Iran” when describing the aircraft carrier group sent to Iran, this caused increased geopolitical tensions and worries about supply disruption
  • Given the sharp rise in crude oil prices, the higher oil Beta linked names, like Schlumberger on the Energy Equipment and Services side as well as the Exploration & Production names rallied the most.

HPF continues to balance exposure to large-cap energy names with a covered call strategy to generate income. The ETF was rebalanced in January with no changes to the names.

Outlook | Oil markets face macro and supply-side instability | HPF retains quality energy names aligned with long-term capital discipline and yield strength.

Harvest US Bank Leaders Income ETF

HUBL rose in January as bank stock returns were generally positive. Regional bank stocks were clear leaders following earnings results that reflected benefits from a steepening yield curve as well as continued high credit quality. Universal mega-cap banks also reported strong earnings for the fourth quarter of 2025, however high expectations for the group led to “sell the news” reactions for those stocks.  The Fund’s performance benefitted from it’s equal-weight approach which leads to higher exposure to the regional bank industry when compared to most market-capitalization weighted U.S. bank indexes.

 HUBL maintains a covered call strategy for income. It remains positioned to benefit from renewed investor confidence in the banking sector as risks around tariffs and policy uncertainty eased.  The ETF will be rebalanced during February.

Outlook | The US Federal Reserve Bank’s rate expectations and loan growth outlooks will shape returns | Covered calls can help manage risk in a volatile macro banking environment.

Harvest Canadian Equity Income Leaders ETF

HLIF recorded decent gains in January and outperformed the broader Canadian market, pushing up yet again into new highs for Canada:

• • HLIF was able to avoid the rougher areas related to technology space in Canadian Market (given they pay little or no dividends). This was positive the Fund from a relative return perspective
  • Additionally, the large weight in Oil & Gas and Energy Pipelines, also helped to propel gains for the Fund, which capitalized on a return of investors worried about escalating tensions between the US and Iran and the potential loss of supply
  • Offsetting some of these gains was a lack of investment into the Mining space, which seemed to catch a bid on the back of a bit of a surge in commodity prices

The ETF focuses on Canada’s top dividend payers, refreshed quarterly. The portfolio’s covered call overlay can help to support stable monthly income in a mixed economic environment.

Outlook | Equal weight and dominant oligopolistic-like companies in the Canadian market | The portfolio remains focused on size & yield in domestic market I HLIF is positioned defensively and favours stable cash flow names.

Harvest Travel & Leisure Income ETF

TRVI declined in January, underperforming the broader market. Some of the movements on the month:

• • Casinos & Gaming, Travel Booking sites and Airlines, led the downside, with casinos in the US in particularly seemingly feeling the pinch of the loss of boycotting Canadian travellers amid trade and border tensions between the two nations
  • Royal Caribbean, on the cruise side, is a big weight in the Index and a very strong reaction higher on earnings helped to offset some of these losses in the other areas.
  • While the consumer has been more resilient than expected, economic data has been mixed recently, and the previously hot pace of the economy doesn’t appear nearly as strong

TRVL offers diversified exposure to top travel stocks.

Outlook | While some short-term pressure from consumer is cautionary; the sector is well positioned to benefit from secular trends like aging demographics and resilient travel demand I The ETF is poised to benefit from renewed interest in the consumer discretionary.

Harvest Industrial Leaders Income ETF

Industrial stocks rallied strongly during the first month of 2026 as investors positioned for an expected acceleration in economic growth on the back of fiscal and monetary stimulus measures enacted in 2025.  Artificial Intelligence (“AI”) theme derivatives within the sector, like Caterpillar Inc., GE Vernova Inc. and Eaton Corp. performed well during the month.   Aerospace & Defense contractor Lockheed Marting Corp. rallied sharply after President Trump announced a desire to increase defense spending by 50% to $1.5 Trillion which was then followed at then end of month by a positive earnings report from the company.  The Fund experienced negative returns for positions in United Rentals Inc. and Delta Airlines.

HIND maintains its covered call strategy for added income while staying positioned to benefit from renewed industrial sector momentum. 

Outlook: HIND remains exposed to economic cyclicals | Earnings momentum and post-selloff strength suggest resilience | Tariff tensions remain a macro headwind.

Harvest Low Volatility Canadian Equity Income ETF

HVOI posted a slightly negative return in January. Overall, it was a mixed month for equities, with volatility in high-growth names, however Canadian equities performed slightly better.  The ETF’s underweight to Materials (Gold), led to slightly underperformance versus the TSX, while the underweight to Technology was a benefit. Agnico Eagle, Suncor, and Bank of Montreal were some top contributing names, while Fairfax Financial and Intact Financial detracted.

The portfolio made no significant weighting changes in the month. HVOI remains defensively positioned to manage risk. Nonetheless, it still offers exposure to continued equity market growth and balancing stability with participation in upside trends.

Outlook | Strategies focus on stable, lower risk portfolio of Canadian equities | Market turbulence expected to persist | Low-volatility profile may be timely for conservative investors.

Harvest Premium Yield Treasury ETF

Harvest Premium Yield 7-10 Year Treasury ETF

With long bond yields topping out again at the top of the recent range (30 year yields just shy of 5%) HPYT felt a little more flat from month start to month end, despite the higher duration bonds chopping around with yields throughout the month. Meanwhile, the curve tightened a touch with the short-end bond yields moving up very slightly, and that caused HYPM to underperform relatively and put up a very slight negative performance number over the month. The ETFs movements would have keyed in on:

• • The Federal Reserve held steady in January after cutting the overnight rate in December. The market continues to sit at roughly 2 cuts in 2026 (although the second cut is not fully priced in by the market).
  • Long end yields remain elevated given the expectation that the US economy continues to grow, although at a bit of a slower pace, while risk lingers around the what the next headline might be and what Fed independence looks like under an incoming Kevin Warsh chairmanship. Warsh has previously talked hawkishly, but he wouldn’t be presented with the job opportunity if he wasn’t leaning to lower rates

Both ETFs use an active covered call strategy to generate income from exposure to bond market volatility, helping investors offset inflation and deliver higher real yields than traditional fixed income.

Outlook | HPYT/HPYM offer high cash flows from writing covered calls I Macro backdrop has been challenging for longer dated yields I Flexible covered call strategy helps generate cash flows.

Harvest Diversified Monthly Income ETF

Harvest Diversified Equity Income ETF

HDIF and HRIF delivered slightly positive returns in January, approximately in line with the S&P 500, as equity markets oscillated during the month, with volatility in high-growth, AI related names. Gains were led by strong performances from HUTL (Harvest Equal Weight Global Utilities Income ETF), as well as HIND (Harvest Industrial Leaders Income ETF) and HUBL (Harvest US Banks Leaders Income ETF).   TRVI (Harvest Travel & Leisure Income ETF) and HHHIH (Harvest High Income Equity Shares ETF) detracted from overall return.

The ETFs increased weight to HHIH, on weakness in Technology stocks, to enhance the growth exposure in the ETF, while maintaining an overall balanced mix.

Outlook | HRIF and HDIF overall remain defensively positioned with multi-sector exposure and high-income strategies to moderate risk | Existing macro and policy uncertainties justify having a diversified approach.

Harvest Balanced Income & Growth ETF

Harvest Balanced Income & Growth Enhanced ETF

HBIG and HBIE were roughly flat over the month, in line with the S&P 500. Top equity contributors included HUTL (Harvest Equal Weight Global Utilities Income ETF), as well as HIND (Harvest Industrial Leaders Income ETF). Fixed income was relatively neutral on the month, as interest rates remained rangebound. On the equity side, TRVI (Harvest Travel & Leisure Income ETF) and HHHIH (Harvest High Income Equity Shares ETF) detracted from overall return.

The ETFs increased weight to HHIH, on weakness in Technology stocks, to enhance the growth exposure in the ETFs, while maintaining an overall balanced mix.

Outlook | Balanced equity-fixed income structure continues to help buffer downside | Enhanced income and diversification support resilience.

Harvest Global Gold Giants Index ETF

Everything was going well for HGGG in January, up prior to the announcement on Kevin Warsh as the next Fed Chair nominee. A steep selloff to end the month, still left HGGG up nearly 8% on the month.

Gold had been attracting flows as something that can hold value in an environment of trust erosion and wealth protection. While the kneejerk reaction has been to assume Kevin Warsh will not be as engaged in pushing for steep rate cuts, there remain many questions around Fed independence and just how hawkish he will be given the President’s great involvement in the selection.

Also, geopolitical concerns remain with Iran as a renewed flashpoint. Gold retains its appeal as a safe-haven asset when the unexpected hits, which is arguably heightened these days, but also amidst sticky inflation and rising deficits.

HGGG invests equally across the world’s 20 largest gold producers, providing leverage to gold price moves and long-term diversification benefits, especially during volatile market cycles.

The ETF will be rebalanced and reconstituted in February.

Outlook | Concerns around Fed Independence just can’t seem to be shaken despite Kevin Warsh being nominated as the new Fed Chair | Geopolitical noise and sticky inflation keep gold’s safe haven appeal intact | Gold producers offer upside leverage and margin strength.

Harvest Travel & Leisure Index ETF

TRVL declined in January, underperforming the broader market. Some of the movements on the month:

• • Casinos & Gaming, Travel Booking sites and Airlines, led the downside, with casinos in the US in particularly seemingly feeling the pinch of the loss of boycotting Canadian travellers amid trade and border tensions between the two nations
  • Royal Caribbean, on the cruise side, is a big weight in the Index and a very strong reaction higher on earnings helped to offset some of these losses in the other areas.
  • While the consumer has been more resilient than expected, economic data has been mixed recently and the previously hot pace of the economy doesn’t appear nearly as strong

TRVL offers diversified exposure to top travel stocks.

Outlook | While some short-term pressure from consumer is cautionary; the sector is well positioned to benefit from secular trends like aging demographics and resilient travel demand I The ETF is poised to benefit from renewed interest in the consumer discretionary.

Harvest Clean Energy ETF

HCLN had another very strong month of performance, continuing from a refreshing 2025 for the sector. The interest in the clean energy space in 2025 has continued into 2026, even as calls over the AI-bubble perk up, and that has some impact on renewable energy demand. Some of the drivers in the Fund:

• • European clean energy stocks as a broad collective appear to have been witnessing outsized gains over the past few months, and that continued in January
  • On the renewable energy side European names like Grenergy Renovables, Nordex, Verbio and Cadler A/S led the way higher, with a nice contribution from Fluence Energy as well out of the US.
  • The power generation names across the globe broadly saw good gains.
  • Long-term clean energy demand appears to be underpinned by global climate goals that still require accelerated investment.

HCLN holds the 40 largest dedicated clean energy and equipment firms, equally weighted and diversified across North America, Europe, and Asia.

The ETF was reconstituted and rebalanced in January. There were six name changes: CGN New Energy, Xinyi Energy, JinkoSolar, Clearway Energy, Thyssenkrupp Nucera, and PNE AG were dropped, while Nextpower (solar equipment), Canadian Solar (solar equipment), Shoal Technologies (solar equipment), Array Technologies (solar equipment), Metlen Energy & Materials (other equipment/services), and T1 Energy (other equipment/services) were added.

Outlook | Massive global clean energy investment needs remain | Long-term drivers are intact | Near-term risks and loss of incentives in the US persist under current administration.

Harvest Low Volatility Canadian Equity ETF

HVOL posted a slightly negative return in January. Overall, it was a mixed month for equities, with volatility in high-growth names, however Canadian equities performed slightly better.  The ETF’s underweight to Materials (Gold), led to slightly underperformance versus the TSX, while the underweight to Technology was a benefit. Agnico Eagle, Suncor, and Bank of Montreal were some top contributing names, while Fairfax Financial and Intact Financial detracted.

The portfolio made no significant weighting changes in the month.

Outlook | Strategies focus on stable, lower risk portfolio of Canadian equities | Market turbulence expected to persist | Low-volatility profile may be timely for conservative investors.

Blockchain Technologies ETF

Blockchain technology equities experienced a liquidity contraction in January. A mid-month rotation out of high-beta assets shifted the sector into a defensive position, though Bitcoin price action served as a sentiment flag early in the month. Institutional interest focused on the evolution of mining business models toward high-performance computing (HPC) to support AI workloads.

Key Performance Drivers

• • Coinbase Global (COIN): Shares remained resilient due to record institutional trading volumes and increased revenue from stablecoin interest and staking rewards.

IREN Limited (IREN): Outperformed the peer group as the company reallocated power capacity to support AI data centers, diversifying revenue away from digital asset mining. Riot Platforms (RIOT) declined during the end of the month. Performance was pressured by rising energy costs and a network difficulty adjustment that compressed operating margins.

Outlook | Short-term volatility remains high following January deleveraging. Long-term fundamentals are tied to institutional adoption, the integration of infrastructure with AI, and the tokenization of financial assets. HBLK holds the 10 largest North American tech leaders and up to 50 emerging blockchain companies.

Harvest Bitcoin Leaders Enhanced Income ETF

The portfolio experienced volatility in January as investors rotated out of high-beta growth leaders. While Bitcoin price action served as a primary sentiment flag early in the month, a mid-month deleveraging event pressured the fund’s NAV. Performance was driven by the fund’s concentrated exposure to bitcoin equity leaders and an active covered call strategy.

Key Performance Drivers

• • Block Inc. (XYZ): A primary contributor to portfolio movement. The company’s diversified fintech ecosystem provided relative stability during the mid-month deleveraging of pure-play digital asset holdings.
  • Robinhood Markets (HOOD): Shares remained resilient, supported by increased retail trading engagement and expanding institutional services, which provided a more stable revenue base during sector fluctuations.
  • Hut 8 Corp (HUT): Served as a performance drag late in the month. Performance was pressured by rising operational costs and a network difficulty adjustment, which impacted margins for infrastructure operators.

Outlook | Short-term technicals remain defensive following the January decline. Long-term fundamentals are tied to the institutionalization of the ecosystem and the expansion of digital assets into regulated financial markets. HBTE holds 16 leading companies in space, utilizing an option-writing strategy to enhance yield and mitigate volatility.

Harvest Bitcoin Enhanced Income ETF

 HBIX, which provides indirect, levered exposure to Bitcoin through the IBIT ETF, experienced heightened volatility in January and ended the month in negative territory. Performance was driven by a mid-month rotation out of risk-on assets, although the fund’s active covered call strategy provided a partial buffer by generating additional income during the downside movement.

Outlook | The near-term outlook for HBIX remains characterized by high volatility. Bitcoin currently lacks the momentum required to reclaim its October all-time highs, with technical indicators suggesting a period of price consolidation. However, a more favorable regulatory environment and sustained institutional adoption could provide long-term structural tailwinds. The ETF’s covered call strategy is designed to provide resilience through income generation amid these market fluctuations.

Harvest Diversified High Income Shares ETF

HHIS declined in January, as despite a positive start to the year, as the month progressed investors shifted more towards “old-world” cyclical and value-oriented exposures, and overall sold higher growth companies including companies engaged in the crypto ecosystem. Investor concern around AI valuation continued as a headwind to certain higher growth exposures held in the portfolio over the month.

The main detractors for HHIS in the period were PLTE (invests in Palantir), MSHE (invests in Microsoft) and RDDY (invests in Reddit).Positive contributors for HHIS included AMDY (invests in AMD), GOGY (invests in Alphabet), and METE (invests in Meta).

HHIS added a position in CRWY (invests in Crowdstrike) during the month, bringing the total number of holdings to 20.  Crowdstrike is a high-growth company, and market leader in cybersecurity products and services, complementing other growth exposures in the ETF.

Option premiums were well supported. The income generation through covered calls writing remained around a 33% write-level across the suite. Option coverage was increased on MSTY/MSTE (invests in Strategy), CRCY (invests in Circle) and CONY/CNYE (invests in Coinbase) to help support the distribution.

Outlook | HHIS continues to offer diversified, enhanced income exposure to high-growth U.S. stocks.

Harvest Canadian High Income Shares ETF

HHIC had a solidly positive month,. While investors raised concerns in US high-growth technology exposure, Canada equities, more value oriented in nature, as well as more commodity-linked, outperformed on the month. 

Positive contributors for HHIC came from TD Bank and Royal Bank, as Banks reported strong Q4 earnings. Cameco was also a strong performer, with continuing positive sentiment on the long-term growth of nuclear energy, as well as Agnico Eagle, which benefitted from gold price movements. The only detracting sector was Canadian Telecoms, which underperformed on the month.

The corresponding single stock ETFs that benefitted the most over the month were TDHE, RYHE, CCOE, and AEME, with BCEE and TEHE detracting.

Option premiums were well supported. Income generation through covered calls writing remained at around 33% write-level across. There were no significant changes to HHIC composition during the month.

Outlook | HHIC continues to offer diversified, enhanced income exposure to a portfolio of notable Canadian equities. The Harvest single stock ETFs based on the stock names in HHIC offer a more concentrated exposure and are designed to provide high monthly income.

Disclaimer

Commissions, management fees and expenses all may be associated with investing in Harvest Exchange Traded Funds (managed by Harvest Portfolios Group Inc.). The funds are not guaranteed, their values change frequently and past performance may not be repeated. Please read the relevant prospectus before investing. Tax, investment and all other decisions should be made with guidance from a qualified professional.

Certain statements in this commentary are forward looking. Forward-looking statements (“FLS”) are statements that are predictive in nature, depend upon or refer to future events or conditions, or that include words such as “may,” “will,” “should,” “could,” “expect,” “anticipate,” “intend,” “plan,” “believe,” or “estimate,” or other similar expressions. Statements that look forward in time or include anything other than historical information are subject to risks and uncertainties, and actual results, actions or events could differ materially from those set forth in the FLS. Although the FLS contained herein are based upon what the portfolio manager believes to be reasonable assumptions, the portfolio manager cannot assure that actual results will be consistent with these FLS. Unless required by applicable law, Harvest Portfolios Group Inc. does not undertake, and specifically disclaim, any intention or obligation to update or revise any FLS, whether due to new information, future events or otherwise.

FundGrade A+^® is used with permission from Fundata Canada Inc., all rights reserved. It reflects risk‑adjusted performance and is based on Fundata’s GPA‑style 12‑month methodology with assigned grades A to E and corresponding scores 4 to 0. Funds with a GPA of 3.5+ receive a FundGrade A+^®. There are 21 ETFs in the Health Care Equity category (CIFSC). For full methodology, visit www.FundGradeAwards.com.