1. What types of investors should consider the Hamilton Enhanced Multi-Sector Covered Call ETF (HDIV) and the Hamilton Enhanced U.S. Covered Call ETF (HYLD and HYLD.U)? These two ETFs are designed for long-term investors seeking higher monthly income and sector diversification from Canadian equities (HDIV) and U.S. equity markets (HYLD and HYLD.U). These ETFs utilize modest 25% cash leverage to enhance yield and return potential. At…
Insights & Commentary
Canadian Bank CEO Event with RBC & TD
On June 9, 2022, we hosted a panel discussion on the Canadian banks with Dave McKay and Bharat Masrani, CEOs of Royal Bank and TD Bank, respectively. During the panel discussion, the CEOs discussed their views on a variety of topics, including the current macro environment, domestic banking, housing, consumer debt, and their international platforms. Disclaimer: Commissions, trailing commissions, management fees and expenses all…
Canadian Banks: TD Buys FHN – A Very Strong Fit
After much speculation in recent years about its appetite for additional U.S. bank M&A, TD offered ~US$13.4 bln in cash to buy First Horizon Corporation (FHN)[1], a Tennessee-based regional bank, in late February, almost 15 years since its last “large” U.S. bank acquisition – Commerce Bancorp. In our view, the acquisition offers many strategic benefits given FHN: (i) is an optimal size, adding material scale with…
Video: Market Outlook and Q&A with Ed Yardeni and Rob Wessel
Hamilton ETFs presents a Q&A with prominent Wall Street strategist, Ed Yardeni, moderated by Rob Wessel. Ed has been one of the most influential Wall Street strategists over the last 30 years and is regularly on CNBC. Rob asks Ed for his outlook on the U.S. and global equity markets, inflation, interest rates and, of course, the financials. Disclaimer: Commissions, trailing commissions, management fees and…
Canadian Banks: 2022 starts with M&A; Recovery Continues (fQ1 in Charts)
2022 is off to a noteworthy start for the Canadian banks, with long-awaited M&A announcements and another strong earnings season. In December, we posted our outlook for the year, “Canadian Banks: Five Possible Drivers in 2022”, in which we stated that the cyclical recovery was not yet over. We identified five factors that we expected would influence bank share prices during 2022: (i) reserve releases, (ii)…
Canadian Banks: BMO’s High Risk, High(er) Reward Acquisition of BoW
Bank of Montreal recently announced the acquisition of BNP Paribas’ U.S. retail banking subsidiary, Bank of the West (BoW) for ~C$20 bln – the largest acquisition in Canadian banking history. The transaction is very different from prior acquisitions made by the Canadian banks and is further complicated by the fact that BoW is not publicly traded (wholly owned by BNP), so most Canadian investors have limited…
HCAL/HCA Lead All Canadian Bank ETFs in 2021
During 2021, the Hamilton Enhanced Canadian Bank ETF (HCAL) and the Hamilton Canadian Bank Mean Reversion Index ETF (HCA) outperformed all other Canadian bank ETFs, rising 51.5% and 40.3%, respectively. Entering last year, we forecast the Canadian banks would have a very strong year (see our insight “Q4-2020 Takeaways – Recovery Has Started” and our video “Three Potential Catalysts for 2021”[1]). HCAL outperformed all strategies by…
HFT – ‘Blue Chip’ Fintech ETF with Peer Leading Absolute and Risk-Adjusted Returns
We believe Canadian investors should have at least a 5% weighting to ‘blue-chip’ financial innovation. The category has attractive growth prospects (secular EPS growth over 25%), high ROEs, and provides valuable diversification to core Canadian financial holdings (especially banks). In June 2020, we launched the Hamilton Financials Innovation ETF (HFT) for investors seeking exposure to higher growth secular themes but are concerned about downside volatility –…
Canadian Banks: Five Possible Drivers in 2022 (Q4 2021 in Charts)
HCAL Ends Year #1 as the Top Performing Canadian Bank ETF; Hamilton ETF AUM Exceeds $1 bln Before we discuss our outlook for 2022, we wanted to highlight that the Hamilton Enhanced Canadian Bank ETF (HCAL), the top performing bank ETF since its launch in October 2020. Year-to-date (2021), HCAL is outperforming equal weight/yield weighted strategies by 9% and covered call strategies by 14-17%. As of November…
Australian Banks: Robust Earnings and Large Capital Return
A strong recovery of the Australian economy is underway as evidenced by the solid earnings growth seen at the Australian banks in their most recent reporting season. In this insight, we discuss the positive trends impacting the sector. Specifically, we elaborate on the recent operating results (both earnings drivers and capital returns), and other positive trends including economic growth supported by further reopening as well as…
Canadian Banks: How High Can Dividends Go? (and HCAL Outperforms)
Canadian bank dividends, in our view, are poised to rise – a lot. In August, before Q3 earnings season, we argued there was no policy rationale for the continuing moratorium on dividend increases (see “Canadian Banks: Why OSFI Should Lift its Dividend Cap Now”). At the time, earnings and capital were already at all time highs. Moreover, the banks had set aside an enormous ~$21.4 bln…
HCAL Ends First Year as Top Performing Canadian Bank ETF
TORONTO, October 19, 2021 – Hamilton Capital Partners Inc. (“Hamilton ETFs“) is pleased to announce that in its first year ended October 14, 2021, the Hamilton Enhanced Canadian Bank ETF (“HCAL“) had a total return of 60.4%, making it the top performing Canadian bank ETF over this period[1]. HCAL is also one of the highest yielding Canadian bank ETFs with a current indicated yield of 4.95%,…