QYLD Dividend: A Comprehensive Guide to the Nasdaq 100 Covered Call ETF’s Dividend History and Strategy

In the dynamic landscape of exchange-traded funds (ETFs), the Global X Nasdaq 100 Covered Call ETF, more commonly referred to as QYLD, stands out as a unique player. QYLD is strategically crafted to trace the performance of the Nasdaq 100 index, all while implementing a specialized investment approach renowned for generating income – the covered call strategy.

This comprehensive exploration will navigate through the nuances of QYLD, shedding light on the intricacies of its QYLD dividend and uncovering the historical evolution of QYLD dividend history. We will meticulously dissect the covered call strategy that distinguishes QYLD in the realm of income-focused investments, providing valuable insights for investors seeking a blend of stability and returns.

Understanding QYLD:

QYLD Overview:

QYLD, managed by Global X, offers investors a unique blend of exposure to the Nasdaq 100, a prominent index comprising leading non-financial companies listed on the Nasdaq Stock Market. What sets QYLD apart is its commitment to income generation through a strategic use of options trading.

The Nasdaq 100:

Before delving into QYLD’s strategy, it’s crucial to understand the Nasdaq 100. Comprising technology, healthcare, and consumer discretionary companies, this index reflects the performance of innovative and growth-oriented sectors.

QYLD’s Covered Call Strategy:

The Basics of Covered Calls:

At the heart of QYLD’s strategy lies the covered call, an options trading approach with income-generation at its core. In a covered call, an investor holding a particular asset, in this case, the stocks in the Nasdaq 100, sells call options on those stocks. The sale of these options generates premium income, providing investors with an additional revenue stream.

QYLD’s Implementation of Covered Calls:

QYLD systematically sells call options on the Nasdaq 100 index constituents, aiming to capitalize on the premiums offered by these options. This strategy allows QYLD to generate income for investors while maintaining exposure to potential capital gains from the underlying stocks.

Balancing Income and Growth:

The covered call strategy employed by QYLD is a delicate balance between income generation and participation in potential market upside. While the sale of call options provides a steady income stream, investors remain positioned to benefit from stock price appreciation within the Nasdaq 100.

Benefits and Considerations:

Benefits of QYLD’s Strategy:

1. Steady Income: QYLD’s covered call strategy is designed to provide investors with a reliable income stream.
2. Risk Mitigation: The strategy can act as a risk management tool, particularly in volatile markets.
3. Participation in Market Upside: Investors can still participate in potential stock price increases, though to a limited extent.

Considerations for Investors:

1. Potential Limitation on Gains: While providing income, the covered call strategy may limit the extent of capital gains.
2. Impact of Market Volatility: Rapid market movements can influence the effectiveness of the covered call strategy.
3. Ongoing Management: Regular adjustments to the covered call positions are required, adding a layer of active management.

For a comprehensive exploration of dividend strategies in broad market funds, consider diving into the details of the Vanguard Total Stock Market Index Fund (VTI). This deep dive into VTI’s dividend approach provides valuable insights into how this fund navigates the complexities of the stock market to generate returns for investors.

QYLD Dividend Information

QYLD features a dividend yield of 11.56% and has distributed $2.06 per share in the last year. The dividends are paid on a monthly basis, and the latest ex-dividend date occurred on February 20, 2024.

Dividend Yield	Annual Dividend	Ex-Dividend Date
11.56%	$2.06	Feb 20, 2024
Payout Frequency	Payout Ratio	Dividend Growth
Monthly	339.03%	0.14%

QYLD Dividend History

Ex/EFF DATE	CASH AMOUNT	RECORD DATE	PAYMENT DATE
02/20/2024	$0.1772	02/21/2024	02/28/2024
01/22/2024	$0.179	01/23/2024	01/30/2024
12/28/2023	$0.1659	12/29/2023	01/08/2024
11/20/2023	$0.1611	11/21/2023	11/29/2023
10/23/2023	$0.1668	10/24/2023	10/31/2023
09/18/2023	$0.171942	09/19/2023	09/26/2023
08/21/2023	$0.1731	08/22/2023	08/29/2023
07/24/2023	$0.1797	07/25/2023	08/01/2023
06/20/2023	$0.1768	06/21/2023	06/28/2023
05/22/2023	$0.1682	05/23/2023	05/31/2023
04/24/2023	$0.17301	04/25/2023	05/02/2023
03/20/2023	$0.16896	03/21/2023	03/28/2023
02/21/2023	$0.167347	02/22/2023	03/01/2023
01/23/2023	$0.1696	01/24/2023	01/31/2023
12/29/2022	$0.161399	12/30/2022	01/09/2023
11/21/2022	$0.1648	11/22/2022	11/30/2022
10/24/2022	$0.1626	10/25/2022	11/01/2022
09/19/2022	$0.1653	09/20/2022	09/27/2022
08/22/2022	$0.1813	08/23/2022	08/30/2022
07/18/2022	$0.1809	07/19/2022	07/26/2022
06/21/2022	$0.1735	06/22/2022	06/29/2022
05/23/2022	$0.1785	05/24/2022	06/01/2022
04/18/2022	$0.2051	04/19/2022	04/26/2022
03/21/2022	$0.2097	03/22/2022	03/29/2022
02/22/2022	$0.202022	02/23/2022	03/02/2022
01/24/2022	$0.203	01/25/2022	02/01/2022
12/30/2021	$0.499377	12/31/2021	01/07/2022
11/22/2021	$0.2246	11/23/2021	12/01/2021
10/18/2021	$0.196591	10/19/2021	10/26/2021
09/20/2021	$0.190247	09/21/2021	09/28/2021
08/23/2021	$0.187861	08/24/2021	08/31/2021
07/19/2021	$0.222997	07/20/2021	07/27/2021
06/21/2021	$0.193932	06/22/2021	06/29/2021
05/24/2021	$0.2207	05/25/2021	06/02/2021
04/19/2021	$0.228265	04/20/2021	04/27/2021
03/22/2021	$0.22386	03/23/2021	03/30/2021
02/22/2021	$0.2333	02/23/2021	03/02/2021
01/19/2021	$0.228815	01/20/2021	01/27/2021
12/30/2020	$0.229852	12/31/2020	01/08/2021
11/23/2020	$0.222887	11/24/2020	12/02/2020
10/19/2020	$0.21669	10/20/2020	10/27/2020
09/21/2020	$0.2119	09/22/2020	09/29/2020
08/24/2020	$0.22	08/25/2020	09/01/2020
07/20/2020	$0.214328	07/21/2020	07/28/2020
06/22/2020	$0.2092	06/23/2020	06/30/2020
05/18/2020	$0.2042	05/19/2020	05/27/2020
04/20/2020	$0.1986	04/21/2020	04/28/2020
03/23/2020	$0.1806	03/24/2020	03/31/2020
02/24/2020	$0.2377	02/25/2020	03/03/2020
01/21/2020	$0.1989	01/22/2020	01/29/2020
12/30/2019	$0.1654	12/31/2019	01/08/2020
11/20/2019	$0.1951	11/21/2019	11/29/2019
10/23/2019	$0.1769	10/24/2019	10/31/2019
09/25/2019	$0.1754	09/26/2019	10/03/2019
08/21/2019	$0.2273	08/22/2019	08/29/2019
07/24/2019	$0.1711	07/25/2019	08/01/2019
06/26/2019	$0.2153	06/27/2019	07/05/2019
05/22/2019	$0.2114	05/23/2019	05/31/2019
04/24/2019	$0.1789	04/25/2019	05/02/2019
03/20/2019	$0.2035	03/21/2019	03/28/2019
02/20/2019	$0.185	02/21/2019	02/28/2019
01/23/2019	$0.2174	01/24/2019	01/31/2019
12/28/2018	$0.1721	12/31/2018	01/08/2019
11/21/2018	$0.225	11/23/2018	11/27/2018
10/24/2018	$0.24697	10/25/2018	10/30/2018
09/26/2018	$0.20142	09/27/2018	10/02/2018
08/22/2018	$0.22585	08/23/2018	08/28/2018
07/25/2018	$0.18144	07/26/2018	07/31/2018
06/20/2018	$0.19952	06/21/2018	06/26/2018
05/23/2018	$0.21626	05/24/2018	05/29/2018
04/25/2018	$0.2341	04/26/2018	05/01/2018
03/21/2018	$0.2487	03/22/2018	03/27/2018
02/21/2018	$0.2487	02/22/2018	02/27/2018
01/24/2018	$0.2502	01/25/2018	01/30/2018
12/20/2017	$0.13577	12/21/2017	12/26/2017
11/22/2017	$0.13217	11/24/2017	11/28/2017
10/25/2017	$0.14901	10/26/2017	10/31/2017
09/20/2017	$0.15374	09/21/2017	09/26/2017
08/23/2017	$0.20276	08/25/2017	08/29/2017
07/26/2017	$0.15853	07/28/2017	08/01/2017
06/21/2017	$0.22142	06/23/2017	06/27/2017
05/24/2017	$0.12598	05/26/2017	05/30/2017
04/26/2017	$0.14451	04/28/2017	05/02/2017
03/22/2017	$0.12327	03/24/2017	03/28/2017
02/22/2017	$0.09988	02/24/2017	02/28/2017
01/25/2017	$0.12751	01/27/2017	01/31/2017
12/21/2016	$0.14551	12/23/2016	12/27/2016
11/23/2016	$0.16203	11/28/2016	11/29/2016
10/26/2016	$0.14939	10/28/2016	11/01/2016
09/21/2016	$0.19448	09/23/2016	09/27/2016
08/24/2016	$0.1298	08/26/2016	08/30/2016
07/20/2016	$0.14142	07/22/2016	07/26/2016
06/22/2016	$0.20241	06/24/2016	06/28/2016
05/25/2016	$0.17132255	05/27/2016	05/31/2016
04/20/2016	$0.15556	04/22/2016	04/26/2016
03/23/2016	$0.15788	03/28/2016	03/29/2016
02/24/2016	$0.22029	02/26/2016	03/01/2016
01/20/2016	$0.21392	01/22/2016	01/26/2016
12/23/2015	$0.21453	12/28/2015	12/30/2015
11/25/2015	$0.18099	11/30/2015	12/02/2015
10/21/2015	$0.214175	10/23/2015	10/28/2015
09/23/2015	$0.22156	09/25/2015	09/30/2015
08/26/2015	$0.20353	08/28/2015	09/02/2015
07/22/2015	$0.15206	07/24/2015	07/29/2015
06/24/2015	$0.150278	06/26/2015	07/01/2015
05/20/2015	$0.169419	05/22/2015	05/27/2015
04/22/2015	$0.153313	04/24/2015	04/29/2015
03/25/2015	$0.159652	03/27/2015	04/01/2015
02/25/2015	$0.1542276	02/27/2015	03/04/2015
01/21/2015	$0.230217	01/23/2015	01/28/2015
12/24/2014	$0.14436	12/29/2014	12/31/2014
11/26/2014	$0.203405	12/01/2014	12/03/2014
10/22/2014	$0.24125	10/24/2014	10/29/2014
09/24/2014	$0.194815	09/26/2014	10/01/2014
08/20/2014	$0.22185	08/22/2014	08/27/2014
07/23/2014	$0.209375	07/25/2014	07/30/2014
06/25/2014	$0.2125	06/27/2014	07/02/2014
05/21/2014	$0.2445	05/23/2014	06/05/2014
04/23/2014	$0.2625	04/25/2014	05/08/2014
03/26/2014	$0.19342	03/28/2014	04/10/2014
02/26/2014	$0.193275	02/28/2014	03/13/2014
01/22/2014	$0.2574	01/24/2014	02/06/2014

Comparing QYLD Dividend yield with Peer ETFs (as of Nov 16 2023):

One of the closest peers of QYLD is the Global X Nasdaq 100 Covered Call & Growth ETF (QYLG), which also follows a covered call strategy on the Nasdaq 100 index. However, unlike QYLD, which sells at-the-money call options, QYLG sells out-of-the-money call options. This means that QYLG allows more room for the underlying stocks to appreciate in price, but also receives less income from the option premiums. As a result, QYLG has a lower dividend yield of 7.29% as of Nov 17, 2023, but also a higher total return of 24.76% year-to-date (YTD) as of Nov 16, 2023, compared to QYLD’s 14.58% YTD total return.

Another peer of QYLD is the Global X S&P 500 Covered Call ETF (XYLD), which follows a covered call strategy on the S&P 500 index. This means that the fund buys the stocks in the index and sells at-the-money call options on the same index. The fund also pays a monthly dividend to its shareholders. XYLD has a similar dividend yield of 11.88% as of Nov 17, 2023, but a lower total return of 11.63% YTD as of Nov 16, 2023, compared to QYLD. This is because the S&P 500 index has underperformed the Nasdaq 100 index in 2023, as the latter has benefited more from the growth of technology and innovation sectors.

A third peer of QYLD is the YieldMax TSLA Option Income Strategy ETF (TSLY), which follows a covered call strategy on Tesla, Inc. (TSLA) stock. This means that the fund buys TSLA shares and sells call options on the same stock. The fund pays a quarterly dividend to its shareholders. TSLY has a much higher dividend yield of 21.67% as of Nov 17, 2023, but also a much higher risk and volatility, as the fund is exposed to the price movements of a single stock. TSLY has a negative total return of -9.66% YTD as of Nov 16, 2023, as TSLA stock has experienced significant fluctuations in 2023.

QYLD Expense Ratio

QYLD has gained attention not only for its unique covered call strategy but also for its competitive expense ratio within the ETF landscape.

ETF	Expense Ratio
QYLD	0.60%
QYLG	0.60%
XYLD	0.60%
TSLY	0.99%

As you can see, QYLD, QYLG, and XYLD have the same expense ratio of 0.60%, which means that they charge $60 per year for every $10,000 invested. The expense ratio reflects the annual operating expenses of the fund, such as management fees, administrative costs, and other expenses. A high expense ratio can reduce the net returns of the fund and erode the value of the investment over time.

TSLY has a higher expense ratio of 0.99%, which means that it charges $99 per year for every $10,000 invested. This is much higher than the average expense ratio of the category and the other peer ETFs. This is because TSLY follows a covered call strategy on Tesla, Inc. (TSLA) stock, which is a single stock with high volatility and risk. The fund may incur higher costs to manage the portfolio and hedge the risk.

Therefore, QYLD and its peers have different expense ratios that reflect their different strategies and risks. Investors should consider the expense ratio as one of the factors when choosing an ETF, but also look at the performance, dividend yield, and volatility of the fund.

QYLD Tax Implications

The tax implications of QYLD are different from those of regular equity ETFs, because QYLD uses a mixed straddle approach for taxation purposes. A mixed straddle is a combination of positions that offset each other, such as owning stocks and selling call options on the same stocks. QYLD elects to use this approach to calculate its distributions and determine how they are characterized. According to the fund’s prospectus, QYLD’s distributions may consist of the following components:

• Ordinary income from dividends received from the stocks in the Nasdaq 100 index. This income is taxed at the ordinary income tax rate for the shareholder.
• Short-term capital gains from the netting of the daily gains and losses of the stocks in the Nasdaq 100 index. This income is also taxed at the ordinary income tax rate for the shareholder.
• A blend of 60% long-term capital gains and 40% short-term capital gains from the netting of the daily gains and losses of the call options on the Nasdaq 100 index. This income is taxed at the blended capital gains tax rate for the shareholder, which is lower than the ordinary income tax rate.
• Return of capital, which is not taxable when received, but reduces the shareholder’s cost basis in the fund. This means that the shareholder will pay more capital gains tax when they sell the fund.

The exact breakdown of these components may vary from year to year, depending on the performance of the fund and the market conditions. QYLD provides a tax information page on its website, where shareholders can find the historical distribution data and the tax characterization of each distribution. QYLD also issues a Form 1099 to its shareholders at the end of each year, which reports the amount and type of income received from the fund.

QYLD’s tax treatment is complex and may not be suitable for all investors. Shareholders should consult their tax advisors before investing in QYLD and be aware of the potential tax consequences of holding and selling the fund. QYLD may be more tax-efficient in a tax-deferred or tax-exempt account, such as an IRA or a Roth IRA, where the distributions are not taxed until withdrawal or not taxed at all. However, QYLD may also trigger the unrelated business taxable income (UBTI) rule for some tax-exempt accounts, such as IRAs, which may result in additional tax liability. Shareholders should check with their account custodians and tax advisors to determine if this rule applies to them.