Elevate Shares, parent to the YieldMax and RoundHill ETFs, has launched a new exchange traded fund under the YieldMax banner that seeks to generate monthly income by selling/writing call options on Apple (AAPL) stock. The YieldMax APLY Option Income Strategy ETF (APLY) is an actively managed ETF that seeks current income while maintaining the opportunity for exposure to the price returns of the common stock of AAPL, subject to a limit on potential investment gains.
It should be noted that APLY does not invest directly in AAPL.
To achieve its investment objectives, APLY uses a synthetic covered call strategy. The fund’s options contracts provide exposure to the share price returns of AAPL, current income from the option premiums, and a limit on the fund’s participation in gains, if any, of the share price returns of AAPL.
“Advisor awareness and usage of options-based income seeking strategies is stronger than I had expected till I saw recent VettaFi data,” said VettaFi’s director of research Todd Rosenbluth. “ETFs can take more complicated investment approaches and make them easier to implement.”
Toroso Investments is the fund’s investment adviser, and ZEGA Financial is its sub-adviser. APLY’s managers will employ its investment strategy regardless of market conditions and won’t take temporary defensive positions during periods of adverse markets or economic downturns.
APLY has an expense ratio of 0.99%.