In this article, we will be taking a look at 10 monthly dividend covered call ETFs you can count on.
While exchange-traded funds (ETFs) and exchange-traded notes (ETNs) bear some similarities, such as the fact that both track an underlying asset, they also differ in some aspects. For instance, a major difference between the two is that investing in ETFs implies that you will be investing in a fund that holds the asset it is tracking, while investing in ETNs is more like investing in bonds – since ETNs are unsecured debt notes issued by institutions. However, both investments carry their own risks and benefits at the end of the day, just like any other investment.
Covered call ETFs and ETNs are just another type of the above. These options offer investors with even more income by writing options on the ETF’s own securities. Investors thus do not have to participate or engage with the market directly. According to ETF.com, these ETFs are becoming more valuable, with their assets under management as recorded this year standing at $5.85 billion.
A Mackenzie Investments ETF Report published this year bears witness to the above. The report mentioned that about $10 billion worth of cash inflows into international ETFs was recorded in the financial year of 2020. Additionally, about $7 trillion was recorded as making up the global ETF assets under management, as of September 2020, while the number of ETFs also grew exponentially, standing at over 8000+ by the end of last year. In US-listed ETFs alone, the assets under management were reported to stand at $5.4 trillion, for about 1364 ETFs listed on US markets. The report also mentioned that ETF market growth in the US is far ahead of the same in Canada.
Amid rising uncertainty, investors are flocking to dividend-paying ETFs in addition to the usual dividend stocks like Altria Group, Inc. (NYSE: MO), Medtronic plc (NYSE: MDT), Abbott Laboratories (NYSE: ABT), and Moody’s Corporation (NYSE: MCO).
Investing has become difficult by the day, even for the smart money. The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 86 percentage points since March 2017. Between March 2017 and July 2021, our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the SPY. Our stock picks outperformed the market by more than 86 percentage points (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
Without further ado, let’s take a look at the 10 monthly dividend covered call ETFs and ETNs you can count on.
Our Methodology
We have selected monthly dividend covered call ETFs, ETNs, and regular dividend ETFs and ETNs with yields going up to 20%. For each list item, we have mentioned its yield, ranking them from the lowest to the highest dividend yield. We have also mentioned each fund’s performance relative to the S&P 500 in the past year.
Monthly Dividend Covered Call ETFs and ETNs You Can Count On
10. Amplify ETF Trust – Amplify CWP Enhanced Dividend Income ETF (NYSE: DIVO)
Dividend Yield: 5%
Amplify ETF Trust – Amplify CWP Enhanced Dividend Income ETF (NYSE: DIVO) invests in stocks of companies across diversified sectors, both directly and through derivates. The fund aims to benchmark the performance of its portfolio against the CBOE S&P 500 BuyWrite Index and the Dow Jones Industrial Average Index. It ranks 10th on our list of monthly dividend covered call ETFs and ETNs you can count on.
In the past year, the price return for Amplify ETF Trust – Amplify CWP Enhanced Dividend Income ETF (NYSE: DIVO) was 19.17%, compared to the 33.52% price return of the S&P 500. The total return for the fund was 23.67%, compared to the 10.40% total return of the S&P 500.
Like Altria Group, Inc. (NYSE: MO), Medtronic plc (NYSE: MDT), Abbott Laboratories (NYSE: ABT), and Moody’s Corporation (NYSE: MCO), Amplify ETF Trust – Amplify CWP Enhanced Dividend Income ETF (NYSE: DIVO) is a notable investment pick today.
9. Global X NASDAQ 100 Covered Call & Growth ETF (NASDAQ: QYLG)
Dividend Yield: 5.6%
Global X NASDAQ 100 Covered Call & Growth ETF (NASDAQ: QYLG), an ETF investing in American public equity markets, is next on our list of monthly dividend covered call ETFs and ETNs you can count on. The ETF ranks 9th and invests directly and through derivatives in stocks of companies in diversified sectors.
In the past year, the price return for Global X NASDAQ 100 Covered Call & Growth ETF (NASDAQ: QYLG) was up 16.19% compared to a 29.83% increase for the price return of the S&P 500. The ETF’s total return was 23.15%, compared to a 10.40% total return for the S&P 500. Global X NASDAQ 100 Covered Call & Growth ETF (NASDAQ: QYLG) has also gained 2.61% in the past 6 months and 6.76% year to date.
Like Altria Group, Inc. (NYSE: MO), Medtronic plc (NYSE: MDT), Abbott Laboratories (NYSE: ABT), and Moody’s Corporation (NYSE: MCO), Global X NASDAQ 100 Covered Call & Growth ETF (NASDAQ: QYLG) is a notable investment pick today.
8. Credit Suisse X-Links Silver Shares Covered Call ETN (NASDAQ: SLVO)
Dividend Yield: 6.8%
Credit Suisse X-Links Silver Shares Covered Call ETN (NASDAQ: SLVO) tracks the performance of the Credit Suisse NASDAQ Silver FLOWS 106 Index. The fund ranks 9th on our list of monthly dividend covered call ETFs and ETNs you can count on.
In the past year, the price return for Credit Suisse X-Links Silver Shares Covered Call ETN (NASDAQ: SLVO) was -24.37%, compared to the S&P 500’s price return of 33.52%. The ETF’s total return was 2.57%, compared to the S&P 500’s total return of 10.40%.
Like Altria Group, Inc. (NYSE: MO), Medtronic plc (NYSE: MDT), Abbott Laboratories (NYSE: ABT), and Moody’s Corporation (NYSE: MCO), Credit Suisse X-Links Silver Shares Covered Call ETN (NASDAQ: SLVO) is a notable investment pick today.
7. J.P. Morgan Exchange-Traded Fund Trust – JPMorgan Equity Premium Income ETF (NYSE: JEPI)
Dividend Yield: 7.5%
J.P. Morgan Exchange-Traded Fund Trust – JPMorgan Equity Premium Income ETF (NYSE: JEPI) invests in volatile stocks and stocks of companies deemed socially conscious in their business dealing and that directly promote environmental responsibility. The fund ranks 8th on our list of monthly dividend covered call ETFs and ETNs you can count on.
In the past year, the price return for J.P. Morgan Exchange-Traded Fund Trust – JPMorgan Equity Premium Income ETF (NYSE: JEPI) was 16.47%, compared to the 33.52% price return of the S&P 500.
6. Nationwide Risk-Managed Income ETF (NYSE: NUSI)
Dividend Yield: 7.5%
Nationwide Risk-Managed Income ETF (NYSE: NUSI) invests in growth and value stocks of large-cap companies and seeks current income with downside protection. The fund also employs a long/short strategy, using derivatives like options to create its portfolio. It ranks 7th on our list of monthly dividend covered call ETFs and ETNs you can count on.
In the past year, the price return for Nationwide Risk-Managed Income ETF (NYSE: NUSI) was 8.03%, compared to the 33.52% price return of the S&P 500. The total return for the fund was 16.79%, compared to the 10.40% total return of the S&P 500.
Like Altria Group, Inc. (NYSE: MO), Medtronic plc (NYSE: MDT), Abbott Laboratories (NYSE: ABT), and Moody’s Corporation (NYSE: MCO), Nationwide Risk-Managed Income ETF (NYSE: NUSI) is a notable investment pick today.
5. Global X S&P 500 Covered Call ETF (NYSE: XYLD)
Dividend Yield: 9.7%
Global X S&P 500 Covered Call ETF (NYSE: XYLD) tracks the performance of the CBOE S&P 500 BuyWrite Index, using the full replication technique. The fund also invests in American public equity markets and other financial arenas, and ranks 6th on our list of monthly dividend covered call ETFs and ETNs you can count on.
In the past year, the price return for Global X S&P 500 Covered Call ETF (NYSE: XYLD) was 12.23%, compared to the 33.52% price return of the S&P 500. The total return for the fund was 24.25%, compared to the 10.40% total return of the S&P 500. Global X S&P 500 Covered Call ETF (NYSE: XYLD) has gained 4.31% in the past 6 months and 7.56% year to date as well.
4. Global X Russell 2000 Covered Call ETF (BATS: RYLD)
Dividend Yield: 11.2%
Global X Russell 2000 Covered Call ETF (BATS: RYLD) invests in US public equity markets, growth and value stocks of small-cap companies, and other assets. The fund also tracks the performance of the Cboe Russell 2000 BuyWrite Index, using the representative sampling technique. It ranks 4th on our list of monthly dividend covered call ETFs and ETNs you can count on.
In the past year, the price return for Global X Russell 2000 Covered Call ETF (BATS: RYLD) was 23.49%, compared to the 33.52% price return of the S&P 500. The total return for the fund was 39.23%, compared to the 10.40% total return of the S&P 500. Global X Russell 2000 Covered Call ETF (BATS: RYLD) has gained 3.40% in the past 6 months and 12.78% year to date as well.
3. Global X NASDAQ 100 Covered Call ETF (NASDAQ: QYLD)
Dividend Yield: 11.4%
Global X NASDAQ 100 Covered Call ETF (NASDAQ: QYLD) tracks the performance of the CBOE NASDAQ-100 BuyWrite V2 Index, using the full replication technique. It ranks 3rd on our list of monthly dividend covered call ETFs and ETNs you can count on.
In the past year, the price return for Global X NASDAQ 100 Covered Call ETF (NASDAQ: QYLD) was 7.61%, compared to the S&P 500’s price return of 33.52%. The fund’s total return was 20.99%, compared to the S&P 500’s 10.40% total return. Global X NASDAQ 100 Covered Call ETF (NASDAQ: QYLD) has gained 2.31% in the past 6 months and 1.59% year to date.
2. Credit Suisse X-Links Gold Shares Covered Call ETN (NASDAQ: GLDI)
Dividend Yield: 12.9%
Credit Suisse X-Links Gold Shares Covered Call ETN (NASDAQ: GLDI) tracks the performance of the Credit Suisse NASDAQ Gold FLOWS 103 Index. The fund ranks 2nd on our list of monthly dividend covered call ETFs and ETNs you can count on and is domiciled in Switzerland.
1. Credit Suisse X-Links Crude Oil Shares Covered Call ETNs (NASDAQ: USOI)
Dividend Yield: 20.7%
Credit Suisse X-Links Crude Oil Shares Covered Call ETNs (NASDAQ: USOI) tracks the performance of the Credit Suisse Nasdaq WTI Crude Oil FLOWS 106 Index. The fund is domiciled in Switzerland as well. It ranks 1st on our list of monthly dividend covered call ETFs and ETNs you can count on.
In the past year, the price return for Credit Suisse X-Links Crude Oil Shares Covered Call ETNs (NASDAQ: USOI) was 23.79%, compared to the 33.52% price return of the S&P 500. The total return for the fund was 54.21%, compared to the 10.40% total return of the S&P 500. Credit Suisse X-Links Crude Oil Shares Covered Call ETNs (NASDAQ: USOI) has gained 1.56% in the past 6 months and 12.80% year to date as well.
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Disclosure: None. 10 Monthly Dividend Covered Call ETFs and ETNs You Can Count On is originally published on Insider Monkey.
