When you say both funds, I imagine you mean a stock in Royal and a fund in HCAL?
I'm a big fan of HCAL but one has to acknowledge the risks of the leverage. I'm not a huge fan of utilizing leverage but in an industry like the Canadian banks, which do exhibit lower volatility, I think the leverage makes sense if it fits within your risk tolerance.
The benefits of HCAL are clear. If banks continue to go up, it will go up even further than the banks because of that leverage component. So the main driver here is if banks continue to report lower provisions and accelerated earnings due to that, you will see HCAL continue to outperform an equal weighted non leveraged bank ETF like say HEB.
If the banks slip up due to a deteriorating economy and they head south, HCAL will perform worse as leverage works both ways. Amplified gains but also amplified losses.
I do believe the Canadian banks are something one can simply add to at regular intervals and benefit from lower volatility returns. However, HCAL does present a little bit of an added element because of the leverage. It requires some additional thinking by the investor to decide whether or not the banks will continue to head upwards in price.
With the recent earnings coming out over the last 6 months from the banks, I'm fairly bullish on them in the future and would not blame someone for continuing to hold HCAL. You just have to understand and be comfortable with the small 'bet' you are placing in regards to the leverage.