YieldMax Files Application for Bitcoin Options Income Strategy ETF

• Around April 10, 2024, the ETF is projected to be listed on the New York Stock Exchange.
• A synthetic covered call strategy is the basis of the proposed exchange-traded fund (ETF).

In response to the overwhelming interest in Bitcoin exchange-traded funds (ETFs) in the United States, new and exciting product possibilities are being evaluated. An exchange-traded fund (ETF) called YBIT, which uses a Bitcoin options income strategy, has been proposed by YieldMax to the U.S SEC. Around April 10, 2024, the ETF is projected to be listed on the New York Stock Exchange (NYSE).

According to YieldMax’s SEC filing, the fund would seek to achieve current income while providing indirect exposure to the price returns of certain US-listed exchange-traded products (ETPs) seeking exposure to Bitcoin.

Synthetic Covered Call Strategy

A synthetic covered call strategy is the basis upon which the exchange-traded fund (ETF), also called as “The Fund,” functions. In addition to generating income, this approach is structured to provide investors indirect exposure to the share price returns of underlying Bitcoin ETPs. Importantly, the Fund’s options approach limits the amount that investors might potentially earn.

This exchange-traded fund uses a synthetic covered call strategy that is based on existing Bitcoin spot ETFs. Along with giving exposure to the performance of TBD spot Bitcoin ETFs, its aims are to provide current income. The approach also seeks to improve returns when underlying asset volatility is high.

It is important to note that The Fund will not directly invest in digital assets like Bitcoin. On top of that, it stays away from purchasing Bitcoin or other digital asset-related derivatives outright. The present “spot” or cash price of Bitcoin is not something the Fund is actively aiming to get exposure to.

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