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Author
Jonathan Hobbs, CFA
Date
17 Mar 2025
Category
Market Insights
How Have IncomeShares Covered Call Strategies Performed?
Your capital is at risk if you invest. You could lose all your investment. Please see the full risk warning here.
Since launching in July and September 2024, our single-stock IncomeShares options ETPs have implemented covered call strategies on eight US growth stocks. This strategy involves holding the underlying stock while selling “out-of-the-money” call options. The aim is to generate monthly income while maintaining upside exposure up to the option strike price.
Now that we have several months of performance data, how have these strategies performed compared to the underlying stocks?
What do these returns represent?
The charts below show the total returns across the eight stocks since inception until the first trading day of March. These returns reflect:
- Distribution yield paid to investors in the form of option premium income.
- Changes in the ETP’s NAV. This reflects the impact of the covered call strategy and may include potential NAV erosion.
Each chart below provides a breakdown of IncomeShares ETP performance vs. the underlying stock.
Performance breakdown by stock
METY (Meta), AMZI (Amazon), AAPY (Apple), and GOOI (Alphabet) have delivered positive total returns, outperforming their underlying stocks.
NVDI (NVIDIA) and MSFY (Microsoft) have seen smaller drawdowns than their underlying stocks.
COIY (Coinbase) and TSLI (Tesla) have underperformed their underlying stocks over this period.
Past performance is not indicative of future results. Read our guide to understand how covered call options ETPs may perform in different markets.
Key takeaways
- Four IncomeShares ETPs (METY, AMZI, AAPY, GOOI) outperformed their underlying stocks, benefiting from option income and stable stock prices.
- NVDI and MSFY saw smaller losses than their underlying stocks, showing the downside protection potential of covered call strategies.
- COIY and TSLI underperformed their underlying stocks, illustrating the potential trade-off between income generation and upside participation.
Your capital is at risk if you invest. You could lose all your investment. Please see the full risk warning here.
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