ETF Innovators: BMO Global Asset Management’s income-driven ETF

Key points

Covered call ETFs are increasingly sought after, as Canada's aging demographic are seeking consistent cash flow.
The do it yourself investor segment is the fastest-growing channel, placing new emphasis on industry education efforts.
The ETF industry is expanding beyond passive index tracking into active management, thematic strategies, alternative investments, and options-based solutions.

As the covered call space expands, these income-focused strategies have become essential to portfolio construction – particularly for an aging population demanding consistent cash flow in volatile markets.

Unlike traditional dividends or fixed income, covered call strategies deliver a unique combination: market participation coupled with enhanced income generation through option premium collection. Over a decade ago, BMO Global Asset Management pioneered Canada's covered call exchange-traded fund market. The space has flourished since, with expanded offerings meeting investor preferences for both market participation and enhanced returns. Today's environment of volatility, elevated interest rates, and shifting retirement preferences has accelerated demand for these strategies.

“Covered calls are one part of what I call the holy trinity of income solutions: fixed income, dividends, and covered calls. For investors in this country, particularly with an aging demographic, the demand for income solutions to meet certain needs is paramount.”

Bill Bamber, CEO, BMO Global Asset Management

BMO Global Asset Management's ETF strategy reflects years of refinement driven by direct investor feedback, product innovation, digital engagement, and investor demand for smarter, more accessible solutions. ETFs now reach into areas such as private credit, real assets, and options-based strategies, bringing institutional-grade capabilities to retail investors. They democratize access to sophisticated investment strategies, empowering retail investors and younger generations inheriting wealth. As macroeconomic uncertainty persists, investors will increasingly seek tools to protect purchasing power and navigate volatile markets.

About ETF Innovators

ETF Innovators is a short-form video series hosted by Valerie Grimba, Director, Global ETF Strategy, that spotlights how RBC clients are driving innovation in ETFs. The series tracks the evolution of the global ETF landscape and spotlights the leaders, ideas, and strategies powering the next wave of performance.

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Experts

Valerie Grimba

Director, Global ETF Strategy, RBC Capital Markets

Bill Bamber

Chief Executive Officer, BMO Global Asset Management

ETF Innovators: BMO Global Asset Management’s income-driven ETF

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