Investing · ETF deep dive
HHL Harvest Healthcare Leaders Income ETF
The longest-running fund in the Harvest income stable: 20 US healthcare majors with the 33% write cap, paying 10.24% from a sector Canadians otherwise barely own.
Best for: Income investors who want non-Canadian, non-financial diversification doing the yield work
Pros
- Genuine diversification for a Canadian income portfolio — zero overlap with the banks-pipes-telcos everyone already holds
- Same growth-friendly structure as HTA: calls on at most 33% of the book
- Operating since 2014 — the strategy has lived through several full healthcare cycles
Cons
- 0.98% MER, near the top of the category
- US healthcare carries persistent political/regulatory headline risk (drug pricing, insurers)
- Distribution was trimmed to $0.06/unit — Harvest pays what the premium supports, not a fixed amount
What's inside HHL
| Underlying fund | Weight |
|---|---|
| Agilent TechnologiesA | 5.9% |
| Eli LillyLLY | 5.5% |
| AbbVieABBV | 5.3% |
| Thermo Fisher ScientificTMO | 5.2% |
| AmgenAMGN | 5.1% |
| UnitedHealth GroupUNH | 5.1% |
20 large-cap US healthcare companies, near-equal weight — pharma, devices, insurers (Class A CAD-hedged) (Provider holdings table, May 29, 2026) · holdings as of May 29, 2026 (20 holdings)
The deep dive
HHL holds 20 of the largest US healthcare companies — Lilly, AbbVie, Thermo Fisher, UnitedHealth, Amgen — at near-equal weight, and applies Harvest’s standard program: active call writing on at most 33% of holdings, the rest left to run. Healthcare suits the format for a different reason than tech does: the sector’s defensiveness makes the underlying book steadier, while enough single-name volatility (an insurer headline, a trial readout) keeps premiums worth harvesting. The result is a 10.24% stated yield from a sector with real earnings growth underneath.
For a Canadian retiree this fund’s quiet virtue is what it isn’t: it isn’t banks, isn’t pipelines, isn’t telecom — the three places every other income product on this page concentrates. The honest notes: 0.98% MER; the monthly payout was cut to $0.06/unit, a reminder that Harvest distributes what the strategy earns rather than defending a number; and the yield is stated against a ~$7 NAV, so small per-unit changes move the percentage a lot. Class menu mirrors HTA: HHL hedged, HHL.B unhedged, HHL.U in USD — all at the same MER.
The rest of the field
The rest of the field, one line each:
- ZWC — the broad-Canada book — 72 dividend payers at 6.48%
- ZWB — the $4.4B Canadian-banks fund, running since 2011
- ZWU — utilities, telecoms and pipelines at 7.09%, US sleeve CAD-hedged
- HMAX — Canadian financials yield-maximized to 11.71%
- UMAX — utilities-plus (rails, pipes, telecoms) at 13.40%
- HTA — global tech with a 33% write cap, 8.85%
Frequently asked questions
What does HHL hold?
HHL holds 20 near-equal-weight US healthcare leaders; calls written on at most 33% of holdings — led by Agilent Technologies (A) at 5.9%, Eli Lilly (LLY) at 5.5%, AbbVie (ABBV) at 5.3% (as of May 29, 2026 (20 holdings)). Sector mix: 20 large-cap US healthcare companies, near-equal weight — pharma, devices, insurers (Class A CAD-hedged) (provider holdings table, may 29, 2026). Weights drift between rebalances — active covered calls capped at 33% of holdings (harvest suite-wide); class a is cad-hedged (hhl.b unhedged, hhl.u in usd).
What does HHL cost?
Currently 0.85% management fee; 0.98% published MER (MER as at Dec 31, 2025). Covered-call ETFs are the most expensive mainstream category in Canada — the major funds run 0.71%–0.99% MER, versus 0.11%–0.66% for plain dividend ETFs, because you're paying for an active options program. See the full comparison, and what a ~0.8% fee compounds into with the MER calculator.
Is HHL's distribution yield the same as a dividend yield?
No — and this is the single most important thing to understand about covered-call funds. HHL's distribution is the underlying stocks' dividends plus option premium, the cash received for selling away part of the portfolio's upside. The yield is real monthly cash flow, but it is not "income the businesses earned" — part of it is the market paying you today for growth you won't receive later. Providers state the trade plainly (Hamilton: "writing options caps the upside growth potential of the portfolio that is covered, in exchange for a higher yield"). Tax-wise, providers state that option premiums are generally treated initially as capital gains, and distributions often include return of capital, which reduces your adjusted cost base — check the fund's annual tax-character breakdown and consider professional advice for large non-registered positions. The covered-call guide walks the full mechanics.
The bottom line
The diversifier of the group — covered-call income from a sector that doesn’t move with Canadian rates, banks or oil. Judge it on that job. If you want the same machine pointed at growthier stocks, HTA; if Canadian and cheaper, ZWC.
This page is for educational purposes only and is not investment advice. Fund facts were verified at Harvest ETFs's published fact sheets and product pages on June 10, 2026; holdings and weights are point-in-time and drift between rebalances; published MERs may lag recent fee changes (MER as at Dec 31, 2025). We deliberately do not compare or project returns. Read the fund facts document before buying. See our methodology.