2024-02-23 07:36:34 ET
Summary
- The YieldMax COIN Option Income Strategy ETF focuses solely on selling covered calls on Coinbase, offering a high historical yield.
- The ETF has generated substantial dividend payouts, attracting investors looking for stable exposure to the crypto market.
- However, the ETF's performance has significantly underperformed Coinbase since its inception because there are downsides to its strategy.
The YieldMax COIN Option Income Strategy ETF (CONY) is marketed as a product to generate income while retaining some upside exposure to Coinbase (COIN). The managers aim to achieve this by selling covered calls on the underlying stock. I have to say, I was baffled this kind of ETF exists. It contains exposure to just one stock and sells covered calls, charging a management fee of 0.99% while at it. Usually, though not always, ETFs are at least somewhat diversified in terms of the underlying exposure. In this case, the fate of the ETF depends on Coinbase and Coinbase alone....
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For further details see:
CONY: The High-Risk, High-Reward World Of Single-Stock Exposure ETFs