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As we telegraphed in the September installment of my MoneySense Retired Money column, this month’s column is a book review of David Booth’s Stay Calm, published early in September. For the full review in the October column, click on the highlighted headline: The calming genius of passive investing.
David Booth is founder of Dimensional Fund Advisors (DFA), maker of DFA Index Funds and DFA ETFs. I have long invested some of our family’s money in DFA funds, along with many of the other usual indexing suspects.
They are famously champions of taking a passive set-it-and-forget it approach to investing while minimizing the noise of what they have dubbed “financial pornography” propagated by traditional and social media, and the self-appointed experts who claim they can pick individual stocks or consistently time the markets.
As someone who takes a decidedly hybrid approach to investing in ETFs in various asset classes, — and occasionally indulging in a bit of high-conviction “index skimming” — I found Booth’s Stay Calm to be a refreshing reminder of the sound principles that underlie DFA.
Those who need a refresher on the virtues of passive investing will not be disappointed but as the book’s subhead implies, there are also quite a few lessons about embracing uncertainties in life in general, as well as investing in particular.
Stay Calm was published early in September by Authors Equity and is aptly subtitled “Learn to Embrace Uncertainty in Investing and Life.” The book is divided into three main parts. Part 1 is on the science of investing and covers the Gift of being an Outsider, how Markets work and how to harness public markets. Part 2 is titled “The Mindset to Stay Calm” and the four chapter titles all make for excellent bullet points; Flexibility is the key to navigating Life’s Uncertainties; Don’t Predict, Plan; Control what you can control and manage what you can’t; and Tune out the Noise.
By Donnell Stidhum, Self Directed Retirement Plans LLC
Special to Financial Independence Hub
A self-directed IRA has become one of the most talked-about retirement accounts among investors looking for greater control over how they build wealth.
The appeal is easy to understand. Unlike many traditional retirement accounts that limit you to stocks, bonds and mutual funds offered by a brokerage, a self-directed IRA can provide access to a much broader range of investments, including real estate, private lending, private equity and certain precious metals, provided IRS rules are followed.
But here’s what I tell people during our conversations: having more investment choices doesn’t automatically mean a self-directed IRA is the right choice for you.
Over the years, I’ve seen investors open these accounts because they heard someone made money buying rental properties or investing in private companies. Unfortunately, some discover too late that the flexibility also comes with greater responsibility.
Before opening a self-directed IRA, I encourage people to slow down and ask themselves seven important questions:
1.) Do I understand the investment I’m buying?
This is always my first question.
A self-directed IRA allows you to invest beyond publicly traded securities, but it doesn’t eliminate investment risk. In fact, many alternative investments require even more due diligence because they aren’t traded on public exchanges and often have less transparency.
If you can’t clearly explain how an investment makes money, what could cause it to lose value and how you’ll evaluate its performance, you’re probably not ready to place retirement dollars into it.
Retirement investing isn’t about chasing opportunities. It’s about making informed decisions
2.) Am I looking for flexibility or simply chasing higher returns?
Many investors assume that because a self-directed IRA offers more choices, it must produce better returns.
That’s not how investing works.
The account itself doesn’t create performance. The investment decisions do.
I’ve met investors who have built substantial retirement wealth using traditional index funds. I’ve also met investors who have done exceptionally well with real estate inside a self-directed IRA. The difference wasn’t the account, it was their knowledge, discipline and long-term strategy.
Choose the account because it fits your investment approach, not because it promises bigger returns.
3.) Can I follow the IRS rules?
This is where many investors underestimate the complexity.
The IRS allows a wide range of investments, but it also has strict rules governing prohibited transactions and self-dealing. For example, you generally can’t use IRA-owned property for your personal benefit or engage in certain transactions with yourself or other disqualified persons. Violating these rules can jeopardize the account’s tax-advantaged status.
The rules aren’t designed to discourage investing. They’re designed to preserve the integrity of retirement accounts.
Before investing, understand the rules as carefully as you study the opportunity itself.
4.) Is this investment liquid enough for my retirement plan?
Liquidity is often overlooked.
Suppose your retirement account owns a rental property or a private business interest. Those assets may take months, or even longer, to sell.
That doesn’t necessarily make them poor investments, but it does mean your retirement strategy should include enough liquidity to meet future needs.
A diversified retirement portfolio shouldn’t leave you scrambling for cash because every investment is tied up in long-term assets.
5.) Am I properly diversified?
One of the biggest mistakes I see is concentration.
An investor becomes excited about real estate and moves nearly all of their retirement savings into a single property.
A little over a year ago, we unveiled Canada’s first suite of daily covered call ETFs, made possible by the evolution of the options market and emergence of options that expire every trading day. The innovative and carefully crafted DayMAX™line-up created a new category in the Canadian ETF market, offering a differentiated approach to generating income. One year later, we’re excited to share the results and demonstrate the strategy’s potential.
What are the DayMAX™ ETFs?
Our first three DayMAX™ ETFs consist of two separate holdings — one providing the core equity exposure and the other providing the underlying for the daily options strategy:
The core exposure is a HAMILTON CHAMPIONS™ ETF, specifically, CMVP (Canadian Equity), SMVP (U.S. Equity) or QMVP (Technology), which holds blue-chip stocks and participates 100% in market movements.
A low-cost index fund with healthy options liquidity, like VOO.US or QQQ.US, on which we execute the zero-days-to-expiry (0DTE) options strategy.
Unlike traditional covered call ETFs that use monthly call options and generate income 12 times a year, the DayMAX™ ETFs seek to generate higher and more frequent tax-efficient income from writing call options that expire daily. By selling options in the morning that expire at the market close, the ETFs remain fully exposed to any market movements that occur after trading hours. They also employ modest 25% leverage, intended to enhance overall growth and income potential and help mitigate the yield/return trade-off inherent in covered call strategies.
A year later, these DayMAX™ ETFs have raised a combined $1.3 billion in assets under management (AUM)[1]. Here they are with their respective yields and total returns as of August 31, 2026:
“It’s encouraging first-year evidence that the strategy is performing as intended,” says Nick Piquard, Chief Options Strategist at Hamilton ETFs. “It’s unique, and we believe we’ve hit the right balance between generating high yield and maintaining a high-quality underlying portfolio. We have successfully married our HAMILTON CHAMPIONS™ ETFs with daily covered calls written on a smaller, modestly leveraged exposure. The leverage is designed to offset the upside we’re giving up on those daily options, and so far, it has done that well.”
DayMAX™ One Year In: Comparisons
Below, we compare how a $100,000 investment in each of the DayMAX™ ETFs performed since inception against relevant indices on a total return basis. As you can see, CDAY and QDAY have outperformed the S&P/TSX 60 and Nasdaq-100, respectively, while SDAY has closely tracked the S&P 500.
This is particularly noteworthy given that covered call ETFs tend to lag traditional equity ETFs in bull markets, as they give up some upside potential in exchange for generating income. Over the period shown, the DayMAX™ ETFs portfolio construction, use of modest leverage and daily options strategy helped mitigate this trade-off and even deliver higher total returns in some cases.
The DayMAX™ Advantage: What makes the Suite Unique?
The first three DayMAX™ ETFs have delivered strong returns and distributions in their first year. Let’s examine the key design decisions behind the strategy:
Daily options trading
Options trading is the basis of any covered call strategy. Investors sell call options in exchange for cash premiums at the expense of some potential upside. Usually, the call options employed in covered call ETFs expire in a month, but in recent years, same day options or “0DTE” options became possible. These daily options contracts now represent over 60% of all S&P 500 index options volume on a typical day, underscoring both their rapid adoption and deep liquidity[6].
At Hamilton ETFs, we recognized the potential this development held for investors. With options expiring every day of the week, an ETF can generate income daily by monetizing intraday volatility. While the premium on an individual 0DTE option is lower than that of a one-month option, the key difference lies in the trading frequency: monthly strategies sell options 12 times per year, while 0DTE options can be written ~250 times annually. This should translate into higher total premiums and enable us to pay distributions out to investors more frequently — in the DayMAX™ case, twice a month.
It’s important to add that while daily options contracts are a way of monetizing volatility more frequently, they aren’t always a superior strategy.
“There are different scenarios where one does better than the other. If markets are moving a lot on a day-to-day basis but not on a month-to-month basis, then you’re likely better off with a monthly contract,” says Piquard. “On the other hand, if markets are moving steadily, with only smaller daily movements, you’ll probably be better off with a daily options strategy.”
For that reason, we believe DayMAX™ ETFs may complement longer-duration covered call strategies such as our YIELD MAXIMIZER™ ETFs. By combining daily and monthly covered call strategies, income investors can diversify across time horizons, helping to smooth cash flows and tap into a wider range of income opportunities. In essence, DayMAX™ adds another tool to your income toolkit, enhancing flexibility and supporting more frequent income generation.
100% overnight participation
When designing our DayMAX™ line-up, we chose to sell call options in the morning that expire at the end of that same trading day. While 25% of the overall portfolio remains covered during the trading day, limiting the upside on that portion, the full portfolio (i.e., 125% of the ETF’s net asset value) is exposed to market moves outside of regular trading hours. This can make a dramatic difference to long-term returns given that historically the majority of gains happen overnight. (See also: Unlocking Overnight Returns for Covered Call ETFs)
Overnight Returns vs. Intraday Returns — S&P 500 Index[7]
A high-quality portfolio
It takes a lot more than skillful and diligent options trading to make a covered call ETF successful long-term. We designed CDAY, SDAY, and QDAY to have high-quality underlying portfolios that reflect strong fundamentals and diversification. They each hold a HAMILTON CHAMPIONS™ ETF that provides exposure to blue-chip stocks with demonstrated track records in terms of dividends or profitability and forms the foundation for the strategy.
The DayMAX™ suite reflects the innovative spirit, careful consideration and rigorous testing behind everything we do, and we’re optimistic this novel approach will provide many investors with long-term sustainable cashflows.
Key Benefits of the DayMAX Suite:
Daily call options for higher income: Premiums generated every day
More frequent payouts: Distributions twice a month
Full overnight market exposure: The portfolio remains fully exposed to overnight market movements, including both gains and losses.
High-quality stocks: A diversified, blue-chip underlying portfolio
Enhanced structure: Modest leverage for higher income and growth potential
Options expertise: A team with combined experience of 60+ years to execute strategies
Trivia
JPMorgan commodities research team recently said “… we don’t have a baseline view. We simply don’t know how to model the endgame.”² What has the analysts stumped?
Hint: It’s driving stocks in our EMAX ETFthis year.
[1] As of September 21, 2026. Source: Bloomberg Terminal
[2] Yield is an estimate of the annualized yield an investor would receive if the most recent distribution remained unchanged for the next 12 months, stated as a percentage of the price per unit on August 31, 2026. The yield calculation excludes any additional year end distributions and does not include reinvested distributions.
[3] July 14, 2025, to August 31, 2026. Source: Bloomberg. The graph illustrates the impact to an initial investment of $100,000. It is not intended to reflect future returns on investments in CDAY. The index performance returns are for illustrative purposes only, and the returns do not reflect any management fees, transaction costs or expenses. Investors cannot invest directly in an index.
[4] July 14, 2025, to August 31, 2026. Source: Bloomberg. The graph illustrates the impact to an initial investment of $100,000. It is not intended to reflect future returns on investments in SDAY. The index performance returns are for illustrative purposes only, and the returns do not reflect any management fees, transaction costs or expenses. Investors cannot invest directly in an index.
[5] July 14, 2025, to August 31, 2026. Source: Bloomberg. The graph illustrates the impact to an initial investment of $100,000. It is not intended to reflect future returns on investments in QDAY. The index performance returns are for illustrative purposes only, and the returns do not reflect any management fees, transaction costs or expenses. Investors cannot invest directly in an index.
[7] Source: Bloomberg, S&P Global, Hamilton ETFs. Past performance is not indicative of future results. Overnight vs. intraday returns may differ materially in future periods. Source: S&P Global, Bloomberg, Hamilton ETFs. Data from Jan 1, 2000, to August 31, 2026. The graph illustrates the growth of an initial investment of $100 in the SPDR S&P 500 ETF Trust (SPY), the SPDR S&P 500 ETF Trust (SPY) overnight, and the SPDR S&P 500 ETF Trust (SPY) intraday with annual compounded total returns. The graph is for illustrative purposes only and intended to demonstrate the historical impact of the indexes compound growth rate during intraday and overnight sessions. It is not a projection of future index performance, nor does it reflect potential returns on investments in the ETF. Investors cannot directly invest in the index. All performance data assumes reinvestment of distributions and excludes management fees, transaction costs, and other expenses which would have impacted an investor’s returns.
Looking for consistent cash flow without the guesswork? See how Target Cash Flow ETFs are redefining cash flow investing.
Image from Pixabay
By Darim Abdullah, BMO Global Asset Management
(Sponsor Blog)
For many investors, especially those approaching or in retirement, generating consistent cash flow is one of the most important goals in a portfolio. Traditionally, that meant relying on dividends, coupons, or systematic withdrawals. But these sources can fluctuate, making it difficult to plan with confidence.
A newer category of solutions, Target Cash Flow ETFs, has been launched by BMO ETFs to help address this challenge. These strategies shift the focus from simply “earning yield” to delivering a defined cash flow outcome.
What are Target Cash Flow ETFs?
Unlike traditional income funds, where payouts depend on underlying dividends or interest earned, Target Cash Flow ETFs take a more structured approach. They aim to deliver regular monthly distributions based on a predefined annual target (approximately 6% –15% depending on the ETF)1, rather than whatever cash flow the portfolio happens to generate.
This approach aligns with the broader rise of “outcome-oriented” investing where ETFs are built to meet specific investor goals, such as generating cash flow or reducing volatility.
How do they work?
The key difference lies in how distributions are generated.
Traditional cash flow ETFs generally pay out what the portfolio earns (dividends, interest, option premiums).
Target Cash Flow ETFs aim to pay out a set amount, regardless of market conditions.2
To deliver a more regular monthly cash flow, the distribution is built using a blended funding approach. Cash flow may come from the portfolio’s natural sources of return: dividends, interest, and (where applicable) option premiums, and may also include Return of Capital (ROC). ROC doesn’t create an immediate tax liability, but it does reduce your Adjusted Cost Base (ACB) over time, which can affect taxes when the investment is sold. And if ROC isn’t offset by portfolio growth, it can gradually reduce invested capital.
That’s why it’s important to assess the strategy through a total return lens, not just the cash flow. If the portfolio’s total return stays above the distribution yield, the client’s underlying capital can still grow over time; if it’s persistently below the payout, the likelihood of capital erosion increases.
With the above payout breakdown in mind, it is worth noting that the payout levels for the T series solutions were carefully selected after examining the historical long-term returns of the parent portfolios, with the aim of minimizing the return of an investor’s initial capital as much as possible. Over the long term, the objective is for the distribution levels to be supported by the total returns of the underlying portfolios.
BMO’s Target Cash Flow offering
BMO has been an early innovator in this space in Canada3, introducing Target Cash Flow Units (often referred to as “.T series”) across a broad lineup of ETFs.
These units are available on a range of existing strategies including:
Asset allocation ETFs (e.g., all-equity or balanced portfolios)
Covered call ETFs (both dividend and sector focused)
Rather than launching entirely new funds, BMO has added a new .T series of units to existing ETFs, giving investors the ability to choose between traditional distributions and a targeted cash flow approach within the same parent strategy. I
Key Features
BMO’s Target Cash Flow Units are designed to offer: Continue Reading…
Sequence of Returns Risk: Chart by Stefano Starkel
My latest MoneySense Retired Money column touches on a number of blogs that regular readers of Findependence Hub may already have seen, but ties together a few disparate threads that may warrant revisiting. Click on the highlighted headline here for the full article: The CAPE ratio, the 4% rule and retirement anxiety.
The focus is on the 4% Rule, Sequence of Returns Risk early in Retirement, and stock valuations measured by the CAPE Ratio.
The 4% Rule is one of those Personal Finance chestnuts, a topic we explored in Retired Money as recently as late 2025 (here.) My Findependence Hub blog on the 4% Rule appeared late in July here.
Robert Shiller’s CAPE Ratio: the Cyclically Adjusted Price-to-Earnings ratio (CAPE), is a measure of how fairly valued or overvalued stocks may be. The blog on the CAPE Ratio ran late in August here. Both are under my byline: Each contains full raw quotes from a variety of business owners and investment professionals on both sides of the border, gathered on Linked In and a service called Connectively, formerly Featured.com.
A useful primer on the CAPE Ratio was provided by blogger Michael J. Wiener, on his Michael James on Money blog (from early August), also republished here on Findependence Hub in August. He says the CAPE Ratio is “just the current price divided by the average inflation-adjusted earnings over the past decade.” Investopedia defines the CAPE Ratio as “a valuation measure that uses real earnings per share over a 10-year period to smooth out fluctuations in corporate profits.” You can find more on CAPE here on Wikipedia.
See also this recent Findependence Hub blog by Stefano Starkel titled the The Alternative to the 4% Rule isn’t a different number: It’s a different mechanism. There, Starkel argues that “the fragile part of a fixed-withdrawal plan is Sequence-of-Returns risk.” He shows a chart [shown above] that demonstrates how early losses in Retirement can have a dramatically negative impact on returns and thus Retirement income.
Stay Calm
Sure, proper diversification and asset allocation should allow you to Stay Calm, which happens to be the title of a new book published early in September by David Booth: he’s a founder of Dimensional Fund Advisors (DFA), one of the better indexing companies out there. I have finished reading it and plan to review it for MoneySense in the near future.
The main principles of the DFA approach to investing is to keep costs low by minimizing trading and using passive investing vehicles like ETFs, and above all trust the markets over the long term while avoiding picking individual stocks and attempting to time financial markets.