I like QQQX better. They sell covered calls on anywhere from 30% to 70% of their stocks depending on where VIX (volatility) is which optimizes the profit. When VIX is higher they sell more options, when VIX is lower they let shares grow instead. The fund has been around since 2007 and outperforming the market in most years unlike QYLD which keeps eroding and bleeding NAV. Of course there is also QYLG.
They even averaged a 3.24% premium each month for 2022, so they were able to reinvest over 2% each month. It all depends on what that strike price is on the 3rd Friday. If it’s down then they write a call on that lower value. If the index has a healthy recovery before the expiration, then the fund doesn’t see it. Rinse and repeat too often and the NAV will erode. They need more flexibility on the strategy.
.. I've had other high-risk covered calls that pay more with severe nav erosion, and I have to say that global x does it best... My global X ETFs have been stable... Well balanced between dividends and trying to keep the nav healthy.
I keep hearing that the share price will eventually go to zero on QYLD. Is this true? I started my exposure at about the $22-25 mark. Thank you for this interview.
@@PassiveIncomeInvesting Nasdaq can’t but QYLD could. Imagine if qqq went up 10% in a month then down 10. Rinse and repeat a few times and QYLD would tank. Meanwhile QQQ might end up neutral. I own RYLD and XYLD for now.
@@PassiveIncomeInvesting thanks. If you decide to go for the long term cash flow (and DRIP) then it helps to be confident that the fund will exist for a long time.
Global X has the best lineup in terms of being able to understand what’s going on with these funds. Others like Jepi and SVOL are much more sophisticated and not so easy to explain. I’m personally invested heavily in XYLD in my RRSP. Just letting the systematic nature of the fund do it’s thing and produce an awesome yield. Thanks Adrian for another good look under the hood with this fund manager. Hopefully it helps people better understand these products. Cheers 🍻
During 2022, he great majority of distribution was return of capital, especially QYLD. This is simply because it is hard to write options in a down market. MY Fidelity statement confirmed this. The current tax forms on the site confirm that the majority is distributed as ROC. The only upside of this is that this distribution reduces the basis for tax basis or for reduction of the loss over time. This means that if the index rises and enough time passes, you can get out without a loss. There is no covered call on the site today, May 15, 2023.
There needs to be some flexibility when they write that option each month. Rohan even alluded to this issue around the 19-20 minute mark. If the market were to move down drastically around the Friday that they roll the option, then this could be a serious issue. This did happen in March 2020 but it worked out due to the massive volatility for the remainder of the year. This set in stone approach does not appeal to me.
What’s the advantage of buying (and paying) and ETF if the strategy is so easy replicable by everyone? I buy 100 shares QQQ every month and then I sell a put option ATM.. same result.. same risk.. less costs.. 🙄
have a question for You Sir ! most of the Covered call's NAV go down over the period, such as HYLD, QYLD, RYLD, XYLD, even JEPQ [though its trying to recover], now my questions is I have around 2600 Shares in QYLD which is on DRIP and my average cost is 19$ where now i m in loss position of around 6K almost. If i hold the fund for next 2-3 years time horizon does it ever will recover with the current market perspective or it will have a chance to recover with the price of NAV getting higher in future if the market trends to be upwards [For Nasdaq 100]. i have dripped all the dividends since last 9 months but the average was not that great as the timeline is not huge. So any chance to recover the loss within next 2-3 years ? thanks in advance!
I recommend that you look for the ROC(return of capital) ratio of ETFs such as Global X's QYLD XYLD.. This interview wasn't worth it. Global X's performance is ridiculous
Much appreciated Adriano. Great videos. I guess there is a lot of art managing these CC funds which sad to say but Global X just doesn't have. The medium to long term performance of these funds is complete garbage. I may use these funds for short positioning to offset long holdings.
Thank you Global X for launching covered call ETF for europeans! Love the new QYLE ucits etf!
I like QQQX better. They sell covered calls on anywhere from 30% to 70% of their stocks depending on where VIX (volatility) is which optimizes the profit. When VIX is higher they sell more options, when VIX is lower they let shares grow instead. The fund has been around since 2007 and outperforming the market in most years unlike QYLD which keeps eroding and bleeding NAV. Of course there is also QYLG.
With so much re- investment of the premium, I was hoping the share price would have performed better in a sideways and down Market
They even averaged a 3.24% premium each month for 2022, so they were able to reinvest over 2% each month. It all depends on what that strike price is on the 3rd Friday. If it’s down then they write a call on that lower value. If the index has a healthy recovery before the expiration, then the fund doesn’t see it. Rinse and repeat too often and the NAV will erode. They need more flexibility on the strategy.
Thanks Rob,,,agree with you to some flexibility,,,minor fine tuning
.. I've had other high-risk covered calls that pay more with severe nav erosion, and I have to say that global x does it best... My global X ETFs have been stable... Well balanced between dividends and trying to keep the nav healthy.
That’s because they reinvest half into the fund
Do you think there will be a S&P600 Small cap "LG's" or S&P400 Mid cap "LG's" version?
Nice job with interview. I wish you would have gotten this detailed on the ELNs with your JEPI discussion 👍
I keep hearing that the share price will eventually go to zero on QYLD. Is this true? I started my exposure at about the $22-25 mark. Thank you for this interview.
will the NASDAQ100 Index go to zero? - people say stupid things....
@@PassiveIncomeInvesting Nasdaq can’t but QYLD could. Imagine if qqq went up 10% in a month then down 10. Rinse and repeat a few times and QYLD would tank. Meanwhile QQQ might end up neutral. I own RYLD and XYLD for now.
Is there a life time expectancy for this fund? Is it highly probable that it will still exist in, say, 30 years?
it should be the same as the underlying indexes
@@PassiveIncomeInvesting thanks. If you decide to go for the long term cash flow (and DRIP) then it helps to be confident that the fund will exist for a long time.
Good show. I wish that Reddy had explained how their NAV is calculated.
Nav is simply the intrinsic value of the fund . (Add up all the assets inside the etf and divide that by number of shares )
Global X has the best lineup in terms of being able to understand what’s going on with these funds. Others like Jepi and SVOL are much more sophisticated and not so easy to explain. I’m personally invested heavily in XYLD in my RRSP. Just letting the systematic nature of the fund do it’s thing and produce an awesome yield. Thanks Adrian for another good look under the hood with this fund manager. Hopefully it helps people better understand these products. Cheers 🍻
During 2022, he great majority of distribution was return of capital, especially QYLD. This is simply because it is hard to write options in a down market. MY Fidelity statement confirmed this. The current tax forms on the site confirm that the majority is distributed as ROC. The only upside of this is that this distribution reduces the basis for tax basis or for reduction of the loss over time. This means that if the index rises and enough time passes, you can get out without a loss. There is no covered call on the site today, May 15, 2023.
Adrian, does Rohan have QYLD in his own portfolio 🤔…
lol i would love to know that also
There needs to be some flexibility when they write that option each month. Rohan even alluded to this issue around the 19-20 minute mark. If the market were to move down drastically around the Friday that they roll the option, then this could be a serious issue. This did happen in March 2020 but it worked out due to the massive volatility for the remainder of the year. This set in stone approach does not appeal to me.
Awesome video man, great explanations!
Do they mention about reinvestment of extra premium back into the funds on their website?
th-cam.com/video/XKYOGD4Bppo/w-d-xo.html
What’s the advantage of buying (and paying) and ETF if the strategy is so easy replicable by everyone?
I buy 100 shares QQQ every month and then I sell a put option ATM.. same result.. same risk.. less costs.. 🙄
some people, including myself do not want to manage that. that's Active Income Investing, not Passive :)
have a question for You Sir ! most of the Covered call's NAV go down over the period, such as HYLD, QYLD, RYLD, XYLD, even JEPQ [though its trying to recover], now my questions is I have around 2600 Shares in QYLD which is on DRIP and my average cost is 19$ where now i m in loss position of around 6K almost. If i hold the fund for next 2-3 years time horizon does it ever will recover with the current market perspective or it will have a chance to recover with the price of NAV getting higher in future if the market trends to be upwards [For Nasdaq 100]. i have dripped all the dividends since last 9 months but the average was not that great as the timeline is not huge. So any chance to recover the loss within next 2-3 years ? thanks in advance!
my advice is to stop focusing on stock price only, you need to include the distributions. focus on total returns.
I recommend that you look for the ROC(return of capital) ratio of ETFs such as Global X's QYLD XYLD.. This interview wasn't worth it. Global X's performance is ridiculous
i already did that: th-cam.com/video/XKYOGD4Bppo/w-d-xo.html
Can US persons get on Blossom?
Thanks Adriano!
Much appreciated Adriano. Great videos. I guess there is a lot of art managing these CC funds which sad to say but Global X just doesn't have. The medium to long term performance of these funds is complete garbage. I may use these funds for short positioning to offset long holdings.
Destroy ESG.
Good video!
At the beginning of this video, your guest mentioned, "the life cycle of the fund". What does that mean?
it means the "life cycle of the fund" - its entire life
Do these ETFs get audited like public companies like Apple? It doesn't make any difference nowadays anyway.