Nasdaq Covered Call Income Through QYLD | ETF Trends

By Josh Ortner

  • The Global X NASDAQ 100 Covered Call ETF yields investors an attractive 9.85% a year in income.
  • QYLD follows a covered call strategy which allows investors to earn more consistent income through monthly call premiums.
  • Income investors have earned between 0.43%-1.08% per month since inception.

When I first came across the Global X Nasdaq Covered Call ETF (QYLD), I was pretty skeptical of what the fund was doing. However, covered calls is a straight forward and simple options strategy that can generate consistent income for investors, if it is done right with professional management. With over $835 million in assets under management, the fund is having no problem in attracting new assets.

The fund was recently acquired and re-branded by Mirae Asset Management in 2018 to the Global X funds. Mirae is the 18th-largest issuer of ETFs in the U.S., with roughly $135 billion in assets under management globally.

Individual investors and institutional investors sell covered call options to increase investment income without wanting to sell the underlying security at the current market price. Investors are allured to this strategy as it produces more income in exchange for risking to sell that stock or fund at a higher price in the future.

Summary of QYLD

The Global X Nasdaq 100 Covered Call ETF (QYLD) follows a covered call strategy, in which the Fund buys the stocks in the Nasdaq 100 Index and corresponding sells at-the-money monthly call options on the same index.

QYLD seeks to provide investment returns that correspond to the price and yield performance, before expenses of the CBOE Nasdaq-100 Buy-Write V2 Index. The main selling point that QYLD offers investors is the simple to use model of the fund. Instead of you worrying about when to sell these call options or at what…

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