Global X Nasdaq 100 Covered Call & Growth ETF (QYLG)

QYLG offers exposure to top Nasdaq 100 tech stocks while generating a high, tax-efficient yield, making it ideal for income-focused investors. The fund writes covered calls on 50% of holdings, capping upside but providing consistent monthly income and potential for large year-end distributions. QYLG is best used as a companion to growth ETFs like QQQM, balancing growth and income, especially for retirees or those seeking regular cash flow.

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Global X Nasdaq 100 Covered Call & Growth ETF's strategic 50% covered call approach balances income generation and capital appreciation. The fund's concentration in tech stocks makes it vulnerable in bear markets but allows for potential gains during bull markets. QYLG offers a dividend yield averaging 5%-7%, with favorable tax treatment due to a high return of capital component.

For investors seeking momentum, Global X Nasdaq 100 Covered Call & Growth ETF QYLG is probably on the radar. The fund just hit a 52-week high and has moved up 21.3% from its 52-week low of $28.12 per share.

QYLG offers monthly income via a covered call strategy on 50% of its Nasdaq 100 portfolio, balancing yield and limited capital appreciation. The ETF's strategy caps upside potential, making it suitable for income-focused investors but less ideal for long-term capital growth. Alternatives like QYLD, JEPQ, and QQQI provide higher yields but lower overall total returns.

QYLG sells at-the-money call options on 50% of its portfolio, balancing capital appreciation and income, unlike QYLD, which erodes principal over time. The fund has performed as expected and provided a middle ground to capture both capital appreciation and income. Despite QYLG's performance, it is not recommended for long-term investors due to its inability to adapt to market conditions.

Goldman Sachs Nasdaq-100 Core Premium Income ETF is a top-performing covered call fund focused on the Nasdaq index.

Global X Nasdaq 100 Covered Call & Growth ETF implements a 50% buy-write strategy on the Nasdaq 100. Its objective is to generate income while keeping more growth potential than a 100% buy-write ETF like QYLD. QYLG has performed quite well compared to its peers over the last 2 years, although it is lagging a bit behind JEPQ.

The Global X Nasdaq 100 Covered Call & Growth ETF combines covered calls with capital growth potential. QYLG aims to generate income through selling call options while maintaining exposure to the Nasdaq 100 Index's growth prospects. QYLG offers a balance between income generation and capital appreciation, appealing to investors seeking a middle ground between high-yield and growth-focused funds.

The mega-cap Tech-heavy Nasdaq 100 is up nearly 1% today as of this writing, which leaves it up 4.5% already in 2024. The Nasdaq 100 is now up 64% during its current bull market that began on 12/28/22.

Global X Nasdaq 100 Covered Call & Growth ETF writes covered calls on 50% of its holdings, offering better returns and participation in upside compared to its sister QYLD. QYLG offers less protection in bear markets compared to QYLD, resulting in lower total returns during market downturns. QYLG's NAV has shown no decay and its dividends have remained stable, making it a potentially attractive option for long-term investors.

Global X Nasdaq 100 Covered Call & Growth ETF is a good choice for investors who are bullish on the Nasdaq 100 but don't expect a major rally. QYLG follows a covered call strategy, allowing investors to capture half the upside potential of the underlying index.

When it comes to equity income, there's a perception that dividend-paying companies are light on growth. The recent space of debuted and growing payouts among tech giants such as Apple (NASDAQ: AAPL) and Microsoft (NASDAQ: MSFT), among others, has altered that scenario for the better.

The Nuveen Nasdaq 100 Dynamic Overwrite Fund (QQQX) and Global X Nasdaq 100 Covered Call & Growth ETF (QYLG) both overwrite approximately 50% of their portfolios, but QQQX has lagged behind QYLG in total returns. QQQX has a higher expense ratio (0.92%) compared to QYLG (0.6%) and its 'dynamic' overwriting strategy appears to add 'negative alpha' compared to Global X's mechanical overwriting strategy. The author recommends investors currently holding QQQX to consider switching to QYLG.

This article provides an overview of the Global X Nasdaq 100 Covered Call & Growth ETF. The QYLG ETF shares operating similarities with the QYLD ETF that I am cautious on. However, the key difference is that QYLG only overwrites 50% of its portfolio. This allows for modest capital appreciation and an attractive distribution. Compared to the SPY ETF, the QYLG ETF may be a better mouse trap with higher total returns and yield.