Roundhill WeeklyPay Universe ETF

WPAY

Market cap $243M

WPAY has solid core holdings, and the fund's strategy is simple but should be effective. This ETF's leveraged position in some more volatile positions, such as Coinbase, will likely make this fund more dependent on this position, but that should be a minor issue. WPAY's decision to not pay upside gains or downside losses makes the investment higher-risk, but also more likely to maximize the income this ETF can pay out.

The Roundhill WeeklyPay Universe ETF has delivered negative total returns since inception, raising concerns about capital recovery for income-focused investors. WPAY's high volatility, limited to 20-24 holdings, undermines its reliability as a stable income source compared to broader, lower-beta ETFs like QDTE or XDTE. The issue of NAV erosion and poor DRIP recovery compounds WPAY's unattractiveness, especially during volatile market periods when stability is paramount.

Roundhill WeeklyPay Universe ETF (WPAY) remains a buy, leveraging uncapped equity growth and AI-driven margin expansion for high-yield income. WPAY's 45.7% estimated annual yield is attractive, but payouts and share price are highly sensitive to market momentum and leverage risks. The ETF's strategy avoids options, using 1.2x leverage on large-cap, AI-focused equities, amplifying both upside and downside scenarios.

I expect S&P 500 and tech-driven indexes to trend higher into 2026, though volatility will persist due to elevated valuations. Index-linked option ETFs with OTM strategies and sustainable yields offer the best balance of income, capital preservation, and upside capture. Single-stock and leveraged high-yield option ETFs risk severe capital erosion and unsustainable payouts, underperforming in both rallies and drawdowns.

WPAY offers weekly payments, with a more balanced risk profile than its competitor YMAX. You will learn the 3 key differences between these ETFs that drove my decision to favor WPAY. WPAY's use of weekly option resets allows for better trend capture and NAV protection compared to YMAX's capped upside issues.

Roundhill WeeklyPay Universe ETF targets high-yield investors, offering an eye-catching annualized yield of approximately 55% with weekly distributions. It differentiates itself from other high-yield ETFs like YMAX and NEOS, providing innovation in both yield structure and payment frequency. However, the innovation here comes with hidden risks, which might not be acceptable for sustainable income investors.

YieldMax Universe Fund of Option Income ETF and Roundhill WeeklyPay Universe ETF both target high income but use distinct strategies. YMAX employs covered call options on a diverse, growth-oriented portfolio, offering robust upside and defensive qualities in flat or correcting markets. WPAY uses 120% weekly leverage on 15 single-stock ETFs, making it more sensitive to market cycles and potentially riskier in downturns than YMAX.

Roundhill WeeklyPay Universe ETF offers unique weekly distributions and a fund-of-funds structure, appealing to income-focused investors. WPAY's diversified ETF holdings and monthly rebalancing help mitigate volatility, but leverage increases the risk of NAV erosion and amplified losses. With only a month of operating history, the fund has outperformed peers and the S&P 500 in total returns while maintaining a lower expense ratio.

The Roundhill WeeklyPay Universe ETF offers high-yield, income-focused exposure to technology and the Magnificent 7 stocks via a fund-of-funds structure. WPAY stands out by not writing covered calls, allowing for uncapped upside compared to traditional covered call ETFs that make up YMAX's portfolio. The fund has an estimated forward yield of ~50%, based off of the last weekly (annualized) distribution.

Roundhill WeeklyPay™ Universe ETF (WPAY) is rated Sell as few people would want equal-weight exposure to all their underlying leveraged single-ticker funds. WPAY's holdings are not option-based but use total return swaps to deliver 1.2x exposure, resulting in variable weekly distributions tied to asset performance. Equal-weighting across diverse assets in WPAY lacks a coherent investment theme, making it less attractive than selecting individual WeeklyPay ETFs with strong conviction.