Covered-call ETF

Covered-call ETF — a fund (QYLD, JEPI, the YieldMax single-stock family) that systematically writes call options against its holdings and distributes the premiums as a high headline yield. The structural dial is coverage: QYLD sells 100% at-the-money monthly (capping even its post-crash recovery); partial-coverage funds keep some upside for less yield. The evidence: the oldest S&P 500 version returned ~5.3% vs the index’s ~11.3% over 17 years; YieldMax funds captured ~60–70% of their underlying’s return with full downside. Legitimate customer: someone spending the income today who accepts no growth. The tell of mis-selling: accumulators reinvesting the distributions. For PH holders, US-listed versions also pay the 25% treaty withholding and sit inside the estate trap.

First used in: 2.4 · Yield is not free money