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  5. MISC: What are your thoughts on weekly covered call strategy ETF that pays you weekly dividend. [Miscellaneous]
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Q: What are your thoughts on weekly covered call strategy ETF that pays you weekly dividend.

QDTE and XDTE.

Thanks for your excellent service.
Asked by Hector on October 21, 2024
5i Research Answer:

QDTE sells calls on the NasDaq index; XDTE on the S&P 500. The weekly payments are highly variable, but the yields are high. Our thoughts are largely the same as monthly pay covered call funds. They are fine for enhanced income, can lag in a market rally, and investors need to understand there is still plenty of equity risks here. If markets correct or crash, the call option premium will only cushion the blow so much. But the weekly payment does not impact our view either way, really. The funds of course have less re-investment time on the cash amounts paid out, vs monthly pays, but we would see this difference as minor.