The Best Covered Call ETFs - High Yields and No Nav Erosion! (March 2026 Review)

Summary

The presenter reviews covered-call ETFs across five areas: the S&P 500, Nasdaq 100, Russell 2000, gold, and concentrated or single-theme strategies. Her stated aim is to find funds that combine high current distributions with positive price performance, rather than selecting solely by headline yield. The figures are presented as a March 2026 review; they are historical figures, not forecasts.

She says she began investing in covered-call ETFs in 2022 and has built a portfolio that generates over $4,000 per month in distributions. This is her personal experience, not a projection for other investors.

Screening approach

The presenter says she reviewed more than 190 covered-call ETFs and screened for funds that:

• Pay distributions at least monthly and consistently.
• Have a distribution rate of at least 10%.
• Have at least 15% total return over the prior year.
• Have a positive price return over that period, which she uses as a screen against NAV erosion.
• Are assessed using the current distribution rate rather than the trailing 12-month yield, to better reflect present distributions.

She emphasizes that a positive price return over a selected period does not guarantee future performance or prevent future NAV erosion.

Illustrative income math

For a hypothetical $500,000 investment:

• At a 2.67% yield: $13,350 per year.
• At an 11% yield: $55,000 per year.
• At a 20% yield: $100,000 per year.

These examples illustrate the effect of different yields; they are not guarantees of income or total return.

Funds and strategies discussed

• S&P 500 — T-SPY (Tap Alpha SPY Growth and Daily Income ETF): Reported distribution rate of 14.72% and price appreciation of a little over 2% over the prior year. It uses zero-days-to-expiration (0DTE) options, generally at the money, on 100% of its portfolio. The presenter says the daily overwrite can limit upside, although the strategy resets each morning. She also notes that GPIX and SPYI had higher reported total returns—18.16% and 17.66%, respectively—while describing T-SPY as more focused on income.

• Nasdaq 100 — QQQI (NEOS Nasdaq-100 High Income ETF): Reported distribution rate of 13.99% and one-year price return of 5.45%. GPIQ is also mentioned as a balance of income, growth, and tax-deferred return-of-capital (ROC) distributions. The presenter says JEPQ and QQQY use equity-linked notes (ELNs) and may be less tax-efficient in taxable accounts, suggesting they may be worth considering in a Roth IRA.

• Russell 2000 — IWMI (NEOS Russell 2000 High Income ETF): Reported distribution rate of 14.69%, following a $0.60-per-share February distribution, and one-year price growth of 8.53%. The fund is described as holding the Vanguard Russell 2000 ETF and using tax-efficient, out-of-the-money calls. The presenter sees potential support for small caps from lower interest rates, floating-rate debt relief, and small-cap valuations relative to large-cap technology stocks, while noting that this is a market thesis rather than a certainty.

• Gold — IGLD (FT Vest Gold Strategy Target Income ETF): Gold is said to have risen 76% over the prior year; IGLD’s price rose 41.82%, with a reported distribution rate of 21.03%. Rather than holding bullion, IGLD is described as using long calls and short puts on GLD, with cash invested in U.S. Treasuries. It sells short-term covered calls using a target-income approach aiming for a yield approximately 3.85 percentage points above the one-month Treasury-bill rate. Its partial overwrite leaves some exposure to further gold gains. The presenter cautions that the unusually high distribution should not be expected to continue indefinitely.

• Concentrated or “niche” funds: These are presented as high-risk satellite holdings, not portfolio cores. The subtitles give inconsistent ticker spellings; the examples are described as:

  • GDXY: Gold-mining exposure, with a distribution rate above 100%.
  • GOOY/GOOI: Google-focused exposure, with a reported distribution rate above 39%.
  • SOXXY: Semiconductor-focused, targeting about 12% income.
  • BIGY/BIGG: Focused on the top 50 U.S. companies, also targeting about 12% income.

The presenter warns that concentration can put both principal and income at risk. For example, a severe downturn or regulatory action affecting a single company could reduce cash flow and damage the investment. She says such funds should only be used as small “kickers” alongside a diversified portfolio.

Key cautions and disclosures

• High distribution rates are not the same as total returns and may not be sustainable.
• Covered calls can trade away some upside in exchange for option income.
• Concentrated funds can carry substantial company-, sector-, or asset-specific risk.
• The presenter states that the video is for educational purposes only, not financial advice. All investments carry risk, including loss of capital, and past performance does not guarantee future results. She advises consulting a qualified financial professional before investing.

Tickers and instruments mentioned

T-SPY, GPIX, SPYI, QQQI, GPIQ, JEPQ, QQQY, IWMI, IGLD, GLD, and the niche-fund tickers GDXY, GOOY/GOOI, SOXXY, BIGY/BIGG (some spellings vary in the subtitles).

Other instruments or exposures include the S&P 500, Nasdaq 100, Russell 2000, gold, gold miners, semiconductors, Google, U.S. Treasuries, Treasury bills, covered calls, 0DTE options, and ELNs.

Presenter and sources: Stephanie; StockAnalysis.com is cited as the research and data tool used.