PUTW - QQQY: Still A Mammoth Yield Of 57% But Risks Remain
2024-04-06 09:22:32 ET
Summary
- The Defiance NASDAQ 100 Enhanced Options Income ETF (QQQY) writes options against QQQ expiring the same day they are written, aiming for consistent monthly yield distributions.
- QQQY has been maintaining a high distribution rate, but the distributions have been declining as the price falls.
- The fund carries significant market risk, particularly in the event of a sudden and dramatic fall in the NASDAQ 100 index.
- This article discusses further risks to the fund and compares QQQY to its peers.
Introduction
In my quest to find income funds that focus on asymmetric risk and reward situations, I stumbled upon the Defiance NASDAQ 100 Enhanced Options Income ETF ( QQQY ). I covered its first 60 days back in November 2023.
This article will serve as a follow-up to my previous conclusion, which was:
QQQY: Still A Mammoth Yield Of 57%, But Risks RemainI will try to cover QQQY again...to see how the strategy changes and evolves...Until then, I have to rate the fund a hold as I don't believe we have the data to say how this investment will act and I don't see it having a place in my income portfolio currently.