"Some of YieldMax's exchange traded funds (ETFs) offer huge annual distribution yields, and legions of passive income investors are loading up on these intriguing funds. Today, we're putting three YieldMax ETFs with eye-catching yields under the microscope. These are risky funds, and it's not wise to YOLO (You Only Live Once) your entire investment account into these ETFs. Still, they have enticing benefits for yield seekers and may be appropriate for small position sizes in your portfolio."
"Sometimes, investors with a bullish outlook on Bitcoin ( CRYPTO:BTC) will buy shares of Strategy ( NASDAQ:MSTR), a software developer that holds many Bitcoins. There isn't a one-to-one correspondence, but when the Bitcoin price goes up, the price of Strategy stock also tends to rise. However, passive income investors may be disappointed to discover that Bitcoin doesn't pay a dividend and neither does Strategy stock."
YieldMax offers ETFs that generate large annual distribution yields, attracting passive-income investors. The funds use option-based strategies to create income, including synthetic covered calls, put selling and covered call spreads to simulate equity ownership and capture premiums. One ETF (MSTY) targets exposure to a Bitcoin-holding company by synthetically replicating stock positions and then selling covered calls to derive weekly income, while holding cash and U.S. Treasuries for liquidity. These strategies tend to limit upside in share-price performance and introduce significant risk, making these ETFs more appropriate as small, tactical portfolio positions rather than core holdings.
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