QYLD has been running the covered call playbook on the Nasdaq-100 since December 2013, and with $8.3 billion in assets, it remains the dominant fund in this category. The strategy is straightforward: hold the Nasdaq-100 and sell covered call options against the entire index each month, collecting premium that gets distributed to shareholders as income.
When an ETF pays weekly distributions sometimes exceeding 1% of its share price while claiming a 35% yield, you have to look closer and understand what's going on. Roundhill QDTE ETF ( NASDAQ:QDTE) launched in March 2024 with a simple promise: sell daily options on tech stocks, collect the premium, distribute it weekly. Nearly two years in, the fund has attracted $913 million in assets and a devoted following of income seekers.
If you're a retiree or nearing retirement, you should be thinking about investments with steady income streams. Ideally, you'll reinvest that income, but you also have the option of cashing out your dividends if needed. This passive income can supplement your retirement account withdrawals and Social Security. Some retirees will use dividends to cover ongoing costs such as housing and groceries.