Friday, December 30, 2011

A top ETF For Safe Income: dividends plus covered calls

Here is an ETF for income fro relatively safe stocks, plus extra income from selling covered cals: BMO's ZWU.

BMO Covered Call Utilities ETF has been designed to provide exposure to an equal weight portfolio of Canadian utilities, telecoms and pipeline companies, while earning call option premiums. The call options are written out of the money, selected based on the option's implied volatility, and are written in proportion to the securities weight. The option premium provides limited downside protection. The underlying portfolio is rebalanced in June and reconstituted in December. Options are rolled forward upon expiry.


Just Energy Group Inc 6.89%
Atlantic Power Corp 6.53%
Veresen Inc. 6.44%
Rogers Communications Inc 6.41%
TransCanada Corp. 6.31%
Enbridge Inc. 6.30%
AltaGas Ltd 6.26%
Capital Power Corp 6.26%
TELUS Corp. 6.25%
Cdn Utilities Cl A NVS 6.23%
BCE Inc. 6.21%
Fortis Inc. 6.16%
TransAlta Corp. 6.10%
Pembina Pipeline Inc 6.08%
Emera Inc. 6.07%
Manitoba Telecom Services 5.93%

Thursday, December 29, 2011

Why UNG is Crashing

UNG is taking another tumble today. This story repeats itself over and over: contango and storage.


Thursdays is in general due to storage. Here are today's figures:

That red line sticking above the 5 year channel is just dreadful. There is too much of the stuff.

Contango today is there too, but it's not so bad.:

Maybe now that the weather is colder things may change. Hope is the last to day for the dreadful UNG.

Thursday, December 22, 2011

BZF and CYB ETFs distribute massive gains

BZF and CYB dropped significantly yesterday, but the reason is that they distributed massive gains. This happens at the end of every calendar year.

In the case of BZF, the drop was of $5.69, or over 22%.

$5.72 of this was the dividend.


Wednesday, December 21, 2011

The dreadful leveraged ETFs; Some still green after all these years

We track leveraged ETFs live here.

This is a partial capture:

As leveraged ETFs eventually lose their value, it is quite interesting to see that there are still some that are quite green.

Wednesday, December 14, 2011

Royal Bank of Canada loads up on GLD

GLD is the most popular gold ETF. While gold itself is taking a beating, RBC (ticker RY), or its clients, has been adding GLD is massive amounts.

At the end of June Royal Bank of Canada reported holdings of 1,142,143 shares with a market value of $166,752,878. At the time, this was about 0.16% of the total portfolio.

On 09/30/2011, Royal Bank of Canada reported holding 3,138,217 shares, with a market value of $496,026,571. This comprised 0.63% of the total portfolio. 

On Sep 30 GLD was trading at $158.08. Today, after a massive selloff it trades at $152.35.

Thursday, December 8, 2011

Natural gas storage drops by 21Bcf: UNG Moves Higher

As expected, natural gas storage number showed a decline today. The actual figure was -21Bcf:

UNG moved higher, also as expected. Contango is still low at 0.9%:

Tuesday, December 6, 2011

Natural gas alert: contango diminishes, UNG attractive

Here is the current contango situation for natural gas this morning:

Contango in the frotn two miotnhs (January and February is 0.75%. As contango goes, this is quite low. While it does not mean that natural gas prices will rise, it means it is not so bad for UNG which suffers so much when contango is in effect.

From February to March the contango it is even lower at 0.26%.

UNG has dropped in recent two days, making it "interesting".

2 months:

6 months:

Dreadful, dreadful, dreadful, always dreadful.

Thursday, December 1, 2011

Why natural gas and UNG spiked higher today, and what to expect

Storage inventories were released this morning showing the first decline of the season - finally, and barely.

Note how the storage touched the top of the 5-year channel, actually were just above it. Just in time!


Natural gas prices,  however, are still in contango. Therefore, these spikes are usually only temporary. Rinse and repeat.