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Every time the ProShares S&P 500 High Income ETF (CBOE:ISPY) writes another daily call option, holders swap tomorrow's gains for today's yield.
Covered call ETFs promise double-digit yields from a broad equity index.
The ProShares S&P 500 High Income ETF (NYSEARCA:ISPY) charges 0.56% a year to run a daily
Investors have plenty of reasons to celebrate the covered call ETF boom. Covered call strategies have offered new ways to add income to portfolios.
Want current income for rising costs? ETFs have solutions, but not all are created equal; these funds offer both upside and income.
ProShares S&P 500 High Income ETF employs a daily covered call strategy via swaps, targeting a minimum 6% yield with monthly distributions. ISPY has underperformed SPY since inception, with irregular distributions, and a lower yield than key competitors. Given ISPY's short track record, inconsistent payouts, and less compelling risk/return profile, SPYI and GPIX are better alternatives.
In a recent ProShares webcast, Global Investment Strategist Simeon Hyman and Director of Investment Strategy Kieran Kirwan zeroed in on a persistent frustration for income-focused investors: why traditional covered call strategies tend to fall behind when markets rebound.
In this article, you will find the answer to the question: can ISPY be considered a worthy replacement for GPIX? A comparative analysis of these ETFs reveals the advantages of Goldman Sachs' strategy, which is reflected in a higher Total Return. While GPIX possesses a higher upside ceiling, like ISPY, its performance ultimately depends on the accuracy of the portfolio managers' decisions.
SEC filings for ISPY aren't indexed yet — common for recently launched funds. Browse the issuer's filings on SEC EDGAR directly.