So, I do a lot of buy/writes and covered call writing on long-term holdings, as a core of my investing philosophy. In essence, these YieldMax ETFs do this on a large scale, synthetically, and turn growth stocks into growth and income alternatives, due to their covered call writing strategies.
Here is their site and current offerings: https://www.yieldmaxetfs.com/
I've dabbled in a couple of their offerings (NVDY and TSLY), and am considering more. However, I don't fully understand their degree of correlation and decay characteristics over the long term (these are all basically brand new). Over their short term existence, they are fairly well directionally correlated, slightly underperforming on the upside, and slightly overperforming on the downside. I've noticed some beginning trends of decay versus the underlying stock emerging, but like I stated - it's still too early in their existence to evaluate.
Does anyone have any insights or further analysis on these hybrid ETFs? I think they could make sense for an income portion of a portfolio, but obviously have risks that typical high-dividend stocks do not. Any time synthetic instruments try to imitate something, there tends to be more risk and higher expenses associated with them.
Fire away!
Here is their site and current offerings: https://www.yieldmaxetfs.com/
I've dabbled in a couple of their offerings (NVDY and TSLY), and am considering more. However, I don't fully understand their degree of correlation and decay characteristics over the long term (these are all basically brand new). Over their short term existence, they are fairly well directionally correlated, slightly underperforming on the upside, and slightly overperforming on the downside. I've noticed some beginning trends of decay versus the underlying stock emerging, but like I stated - it's still too early in their existence to evaluate.
Does anyone have any insights or further analysis on these hybrid ETFs? I think they could make sense for an income portion of a portfolio, but obviously have risks that typical high-dividend stocks do not. Any time synthetic instruments try to imitate something, there tends to be more risk and higher expenses associated with them.
Fire away!