large call-write portion kills upside
BKCL (Global X equal weight Canadian banks covered call ETF) uses 25% leverage but writes covered calls on a much larger portion of the portfolio (~39.75%), which the speaker argues increases upside capping and helps explain why CBCC outperforms it on total returns.
Covered calls written on roughly 39.75% of the portfolio suppress upside capture despite 25% leverage, a structural drag that explains CBCC's total-return advantage. The combination of leverage and aggressive call writing creates an unfavorable trade-off.
"Top Performing Canadian Banks Covered Call ETF is Beating the Banks?! | Mulvihill CBNK ETF"