"The YieldMax MSFT Option Income Strategy ETF (NYSE: MSFO) boasts an eye-popping 44.17% yield at the time of this writing. However, it comes with an NAV beartrap with sharp teeth as its trade-off."
"MSFO is paying a gigantic dividend yield, but NAV has dropped precipitously, with double-digit losses from 2025 and continuing through 2026."
"This means that in the aggregate, investors' dividends has been a net their own invested funds - after the YieldMax management expenses."
YieldMax has created a niche with single-stock covered call ETFs, particularly benefiting from the volatility of the Magnificent 7 tech stocks. The YieldMax MSFT Option Income Strategy ETF (MSFO) offers a high dividend yield of 44.17%, but this comes with risks, including a significant drop in NAV. The ETF generates dividends through active management of call options on Microsoft stock, but has faced challenges, leading to a reliance on NAV to maintain dividend payouts, resulting in net losses for investors.
Read at 24/7 Wall St.
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