For investors seeking momentum, Global X Nasdaq 100 Covered Call & Growth ETF (QYLG – Free Report) is probably on the radar. The fund just hit a 52-week high and has moved up 21.3% from its 52-week low of $28.12 per share.
Are more gains in store for this ETF? Let us take a quick look at the fund and the near-term outlook on it to get a better idea of where it might be headed:
QYLG in Focus
Global X Nasdaq 100 Covered Call & Growth ETF follows a “covered call” or “buy-write” strategy, in which the fund buys stocks in the Nasdaq 100 Index and “writes” or “sells” corresponding call options on approximately 50% of the value of the portfolio of stocks in the same index. It charges 35 bps in fees per year (see: all the Long-Short ETFs here).
Why the Move?
The covered-call strategy has been an area to watch lately as stock volatility surged after the Fed signaled fewer rate cuts for 2025. A covered call is an investment strategy to generate income and potentially hedge against downside risk. It involves buying a stock or a basket of stocks and then selling or writing call options on those same assets. These options give the buyer the right, but not the obligation, to purchase stocks at a predetermined price before a specified date.
More Gains Ahead?
QYLG might remain strong, given a weighted alpha of 18.82 and a lower 20-day volatility of 11.50%. There is definitely still some promise for investors who want to ride on this surging ETF.
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