Fund group YieldMax filed with the US Securities and Exchange Commission (SEC) to launch an Ether Option Income Strategy ETF on the New York Stock Exchange, Arca, according to a filing dated June 21, 2024. The move comes ahead of the anticipated launch of spot Ether ETFs in the US.
The ETF, using a synthetic covered call strategy, aims to capitalize on the volatility of underlying spot Ethereum ETFs for income generation. Spot Ether ETF holders can sell call options to earn additional income and manage risk
According to the filing, the fund does not invest directly in Ethereum or any spot Ethereum ETF. It will be actively managed by Tidal Investments, with sub-advisory services provided by ZEGA Financial, an SEC-registered investment advisor and manager specializing in derivatives-based investing.
YieldMax offers a range of ETFs, each focused on a specific underlying security or asset. The YieldMax ETFs employ a synthetic covered call strategy, selling call option contracts on underlying securities to generate income from option premiums. Notable examples include ETFs for Tesla (TSLY), Apple (APLY), and Amazon (AMZY).
The latest filing follows YieldMax’s launch of the Bitcoin Option Yield Strategy ETF (YBIT) last year. The fund is listed on NYSE Arca and has an expense ratio of 0.99%.