NFLX - ETV: Transforming FAANG Stock Exposure Into Monthly Dividends

• ETV is a CEF that owns a portfolio of overweight FAANG stocks and writes rolling 1-month covered calls for a premium.
• ETV pays a monthly dividend upwards of 8% from the option premiums received and capital gains on the underlying stocks.
• Unlike the fixed income market, the dividend is not guaranteed and can completely disappear if there is a protracted period of stock market weakness as we saw in 2018-2019.
• This strategy dampens downside losses by the net option premium but also caps upside moves.
• If you feel comfortable FAANG stocks are going to be stable or up-trending, ETV offers a more conservative approach to gain exposure to the basket and receive a substantial monthly dividend.

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