On Thursday, YieldMax launched the YieldMax AI & Tech Portfolio Option Income ETF (GPTY), the latest addition to YieldMax’s ever-growing fund library.
Primarily, the goal of GPTY is to provide current income to its investors. However, the fund also has a secondary objective of generating capital appreciation. The fund is actively managed and has a net expense ratio of 0.99%.
YieldMax employs a multifaceted investment approach in order to simultaneously approach both of the fund’s goals. To start, the fund invests in a curated collection of AI and technology companies. These companies can represent a variety of industries, such as semiconductors, cloud infrastructure, and AI consulting services.
Companies added to GPTY’s portfolio may include those based outside the U.S., including emerging markets. All in all, the fund’s portfolio is expected to hold between 15 to 30 equities in total.
Securing Yield Through Options
As one may expect from a YieldMax strategy, GPTY looks to derive income through an options strategy. These options may be employed on some or all of the fund’s underlying securities.
A wide variety of specific options strategies may be employed by the fund at any time. These strategies include covered call writing, cash-secured put selling, and credit spreads and collars, among others.
Additionally, GPTY will reserve some of its funds to hold cash or invest in short-term U.S. Treasury securities. This is done to provide collateral for the options strategy, though the Treasuries may help bolster the fund’s income.
YieldMax possesses extensive experience in regards to piloting income-driven options strategies. Over 40 YieldMax ETFs are currently listed in the United States.
Many of YieldMax’s options ETFs receive significant interest from investors and asset managers alike. For instance, the YieldMax MSTR Option Income Strategy ETF (MSTY) has over $2 billion in assets under management.
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