YieldMax™ ETF FAQs
Q: Where can I find more information about YieldMax™ ETFs?
A: Please visit www.YieldMaxETFs.com, where you can find each ETF’s prospectus, historical distributions, standardized performance and more.
Q: What is a YieldMax™ ETF?
A: Each YieldMax™ ETF is registered with the Securities and Exchange Commission (the SEC) under the 1940 Act as an open-end investment company (or “open-end fund”) that is authorized to trade on the NYSE Arca stock exchange. As an investment company, a YieldMax™ ETF is subject to the regulatory requirements of the federal securities laws and oversight by a board of directors. Please visit and review the investor bulletin on ETFs at www.Investor.gov for more information on ETFs.
Q: Why do the shares outstanding of YieldMax™ ETFs change so frequently?
A: Like all other exchange traded open-end funds, there is no limit to the number of shares a YieldMax™ ETF can issue. New shares can be issued (or retired) daily in accordance with net buying and selling of the ETF. As such, it is normal and expected for the number of shares outstanding of YieldMax™ ETFs, like those of any other ETF, to change frequently. Please visit and review the investor bulletin on ETFs for more information on how ETFs work. Only authorized participants (“APs”) may engage in creation or redemption transactions directly with an ETF. An ETF has a limited number of institutions that may act as APs and such APs have no obligation to submit creation or redemption orders. Consequently, there is no assurance that APs will establish or maintain an active trading market for the shares.
Q: What is the strategy behind the YieldMax™ ETFs?
A: Each YieldMax™ ETF employs an actively managed strategy best described as a synthetic covered call. The predominant driver of potential income for this strategy comes from the selling of short-term, out-of-the-money calls. These calls are sold over a synthetic long stock position comprised of (i) a long at-the-money call and (ii) a short at-the-money put. This combination of “long call and short put options” is known as a synthetic long stock position because it synthetically mimics the exposure of being long stock.
Q: Which firms are involved in YieldMax™ ETFs?
A: The firms that help manage, advise and/or provide services to the YieldMax™ ETFs collectively have decades of experience in ETF management and options-based strategies. The following is a partial list of those firms:
Q: What factors can impact the potential income of a YieldMax™ ETF?
A: The primary driver of the potential monthly income of a YieldMax™ ETF is the amount of premium earned selling the short-term, out-of-the-money calls. In turn, the premium generated by these sales is materially impacted by the implied volatility (IV) of the options being sold. Investopedia defines “implied volatility” as follows:
Implied volatility represents the expected volatility of a stock over the life of the option. As expectations change, option premiums react appropriately. Implied volatility is directly influenced by the supply and demand of the underlying options and by the market’s expectation of the share price’s direction. As expectations rise, or as the demand for an option increases, implied volatility will rise. Options that have high levels of implied volatility will result in high-priced option premiums.
Please see each ETF’s prospectus for details about the risks of investing.
Q: When are distributions paid?
A: The distribution schedule for YieldMax™ ETFs can be found here.
Q: What are the principal holdings of a YieldMax™ ETF?
A: The holdings of each YieldMax™ ETF can be found on the ETF’s webpage by clicking on or scrolling down to “Holdings”. The table below illustrates the typical principal holdings of a hypothetical YieldMax™ ETF on a hypothetical underlying reference asset, ABCD, at any given time.
Q: When are you launching additional YieldMax™ ETFs
A: We are not permitted to disclose the launch dates of any of our planned YieldMax™ ETFs. However, you can find a list of planned YieldMax™ ETFs in the following prospectuses: Single Stock Prospectus and Single ETF Prospectus. Once launched, information about YieldMax™ ETFs can be found at www.YieldMaxETFs.com.
Q: What other ETFs does YieldMax™ plan to launch?
A: For a list of planned YieldMax™ ETFs, please reference the following prospectuses: Single Stock Prospectus and Single ETF Prospectus.
Q: Are YieldMax™ ETFs available at my brokerage?
A: Each brokerage firm independently determines which ETFs are available on its platform. Please contact your broker for more information.
Q: Can I establish a dividend reinvestment plan (DRIP) on my shares of YieldMax™ ETFs?
A: Each brokerage firm independently determines which products are eligible for DRIP reinvestment. Please contact your broker for more information.
Risks
Investing involves risk. Principal loss is possible.
Single Issuer Risk. Issuer-specific attributes may cause an investment in the Fund to be more volatile than a traditional pooled investment which diversifies risk or the market generally. The value of the Fund, which focuses on an individual security (TSLA), may be more volatile than a traditional pooled investment or the market as a whole and may perform differently from the value of a traditional pooled investment or the market as a whole.
Options Contracts. The use of options contracts involves investment strategies and risks different from those associated with ordinary portfolio securities transactions. The prices of options are volatile and are influenced by, among other things, actual and anticipated changes in the value of the underlying instrument, including the anticipated volatility, which are affected by fiscal and monetary policies and by national and international political, changes in the actual or implied volatility or the reference asset, the time remaining until the expiration of the option contract and economic events.