YieldMax NVDA Option Income Strategy ETF

NVDY

Market cap $1.73B

In the current investment and financial world, there isn't going to be much of an argument when someone says that dividends are having a moment.

Comparing YieldMax MARA Option Income Strategy ETF (MARO) and YieldMax NVDA Option Income Strategy ETF (NVDY) highlights how underlying volatility impacts option income strategies. MARO's high volatility results in better upside capture but fails to cushion drawdowns, making it reliant on MARA's capital appreciation rather than option income. NVDY performs better in neutral to mildly bullish conditions, offering a higher yield on cost and is rated Buy for tactical use in consolidating or overheated Nvidia scenarios.

YieldMax's extensive suite of exchange traded funds (ETFs) have a large and dedicated following, and there are a number of reasons for this.

YieldMax NVDA Option Income Strategy ETF offers a remarkable 79.11% distribution yield, attracting income-focused investors seeking high monthly payouts. NVDY uses synthetic positions and covered call strategies on Nvidia stock, generating substantial income but not replicating NVDA's capital appreciation. NVDY's Distributions generated over 20% of the initial investment in the first 4 months, and it's on track to pay for the entire investment within the next 16 months.

Income-focused investors have plenty of options at their disposal when it comes to exchange-traded funds (ETFs). One type of ETF that is gaining a lot of traction today is option income ETFs.

Pessimistic market sentiment often creates generational buying opportunities. Legendary investors like Warren Buffett have made fortunes by being greedy when others are fearful. Unfortunately, while the data points provide a ground for being fearful, the market is still greedy. We could make a case for experiencing 'the everything bubble'.

YieldMax NVDA Option Income Strategy ETF offers income and limited upside on Nvidia through an options strategy, ideal for investors seeking exposure to AI with reduced risk. Nvidia's strong earnings and $60B buyback program reinforce confidence in its AI leadership and management's belief in undervaluation. The covered call strategy benefits investors if NVDA remains flat or rises moderately, but caps gains if NVDA surges significantly.

NVDY offers high monthly income by selling covered calls on NVDA. Despite a 30% price drop, NVDY's massive trailing yield delivered a strong total return, appealing to income-focused investors over NVIDIA's very low dividend. 2025 distributions have dropped sharply compared to 2024, making it harder for new investors to recoup capital as quickly, but yields remain attractive.

The YieldMax NVDA Option Income Strategy (NVDY) ETF stock will be in the spotlight this week as Nvidia publishes its financial results. NVDY stock was trading at $16.90, a few points below the year-to-date high of $17.2.

I strongly believe investing is about making your money work for you. When I invest in any asset, I look for the ways it will grow my money, and one of the most important is dividends.