The TFSA side of Capstan Systemâ„¢ holds 8 positions. 7 pay monthly distributions. One pays nothing, by design. They work together to back the margin engine with collateral while paying C$60 a month in declared income. Start with the three the database likes best. $HDIV V and $HMAX rank 1st and 2nd of the 70 rated funds in my covered call database. $HYLD ranks sixth. HDIV has gone 61 months without a cut and raised eight times in the past year. HMAX has gone 41 months and raised six times, a tenth of a cent at a time. HYLD has raised 7 times. They all sit at 10 percent each. The anchor is $HHIC at a 30 percent target. Concentrated Canadian covered calls from Harvest. The distributions have gone 0.16 to 0.18 to 0.20 per unit and never moved backwards. Most of that is stamped return of capital on the tax slip, which decides nothing inside a TFSA. The test that matters is whether the price bleeds while it pays, and it does not: unit price up on the year, total return above 20 percent. It ranks 38th in my database for one reason: the record is 13 months old. Every month it pays without a cut moves it up the board. The biggest slot is a bet that the cleanest young record in the book stays clean. $GLCC is gold producers with covered calls, 12 percent target, rank 27, no cut in almost four years. It ran to 18 percent of the book on gold's run, so it is frozen. No sells. New money goes elsewhere until it dilutes back to target. $ENCC is oil and gas at 10 percent, pays the same 12 cents all year, no raises, one cut 20 months back, rank 43. It is here for the energy sleeve and the flat 12 cents, nothing more. $LMAX is healthcare and the weakest record I own. Three cuts inside two years, and it trimmed again in September. It ranks 49th. Cuts get capped, no new money. It is frozen at 8 percent and watched. I hold it because the book wants healthcare and it is still the best covered call option in that sector. $SPCX is SpaceX stock, a 10 percent growth budget. It pays nothing, and the broker lends nothing against it. It is in the book because I want the exposure, and it is capped because it does no work for the engine. The allocation rules are simple. Size follows the distribution record, not the yield. Positions that outrun their target get frozen, never sold. Weak records get a ceiling. Every dollar of new money buys whatever sits furthest under target, which right now means HHIC until roughly December. Everything except SpaceX backs the margin account at 80 cents of buying power per dollar held. The income pays whether the spread book has a good month or not. That is the whole design.
1,162 views
0 Comments
No comments available.
Join the conversation with 500,000+ other investors 💸
Create an account to get access to everything Blossom has to offer!
📊 Personalized algorithm based on your investing style, experience level and interests
📈 Powerful portfolio and dividend tracking tools
👀 See what top creators and others in the community are investing in
