Some ETFs pay you more in dividends over a year than their shares cost today. That sounds like a great deal until you understand why it happens.
NVDY, TSLY, CONY, and MSTY are all part of YieldMax’s lineup of single-stock option income ETFs. Each one sells options on a single high-volatility reference stock (NVIDIA, Tesla, Coinbase, and MicroStrategy respectively) and distributes the premium collected as weekly dividends. The income is real. But so is the erosion that can come with it.
How the Income Engine Works
Each of these funds uses a synthetic covered call structure. Rather than owning the underlying stock directly, the fund holds a combination of call options and short put positions that mimics owning the stock, then sells call options against that synthetic position to collect premium. That premium gets passed to shareholders as income.
The amount collected depends heavily on how volatile the underlying stock is. When implied volatility is high, options premiums are rich, and distributions swell. The VIX, a broad measure of market-wide volatility expectations, closed at 29.49 on March 6, 2026, up 58% over the prior month. That kind of environment inflates the premiums these funds can collect. But the VIX is mean-reverting, and when volatility normalizes, distributions shrink with it.
The structural tradeoff is straightforward: by selling call options, the fund caps its upside participation in the reference stock. If NVIDIA surges significantly, NVDY captures only a fraction of that move. The fund is designed to convert volatility into income, not to track the underlying stock’s price appreciation.
NVDY: The NVIDIA-Linked Income Play
NVDY launched in May 2023 and has grown to roughly $1.3 billion in assets. Its expense ratio is 1.09%, which is reasonable for an actively managed options strategy.
NVDY’s distributions have shifted dramatically since launch. In mid-2024, monthly payouts reached as high as $1.20 to $2.62 per share — a reflection of NVIDIA’s explosive implied volatility during the AI boom. By early 2026, the fund shifted to weekly payments in the $0.09 to $0.12 range, as volatility has normalized and the distribution schedule restructured.
The share price tells a more nuanced story than most high-yield ETFs. NVDY trades around $13.46 today, up roughly 52% over the past year over the past year. That price appreciation, combined with dividend income, reflects the underlying strength in NVIDIA’s stock over the same period. Year to date in 2026, the share price is roughly flat.
TSLY: Tesla Volatility as a Dividend Source
TSLY launched in November 2022 and holds about $950 million in assets. Its portfolio is almost entirely composed of Tesla call and put options across multiple expiration dates and strike prices, which is exactly what you would expect from a fund built to harvest Tesla’s notoriously high implied volatility.
Weekly distributions in early 2026 have run in the $0.29 to $0.37 range per payment. The share price is around $31, up about 53% over the past year. Year to date in 2026, the price is down about 8%, which matters because that decline offsets some of the income collected.
Tesla’s volatility is the core feature here. The stock is prone to large swings in both directions, which keeps options premiums elevated and distributions relatively generous. The flip side is that a sustained decline in Tesla’s stock would drag the synthetic position lower, reducing NAV even as distributions continue.
CONY: Coinbase Exposure With Crypto-Level Swings
CONY is the most volatile fund on this list by a meaningful margin, which makes sense given its reference asset. Coinbase stock moves with crypto sentiment, and that means CONY’s NAV can swing sharply in either direction.
The fund launched in August 2023 with about $398 million in assets today. In 2024, monthly distributions ranged from $1.01 to $2.79 per payment. By early 2026, weekly payments have settled into the $0.22 to $0.41 range.
The price performance shows the volatility risk clearly. Over the past year, CONY’s share price has fallen about 30% to around $30. Year to date in 2026, the price is down roughly 15%. Investors who held CONY through that period collected substantial distributions, but the NAV erosion partially offset the income — making this the clearest illustration of how a fund can pay generous distributions while still delivering a negative total return.
MSTY: MicroStrategy’s Bitcoin Bet, Amplified
MSTY launched in February 2024 and holds about $1 billion in assets. MicroStrategy holds a massive Bitcoin treasury, which means MSTY is essentially a leveraged options play on Bitcoin sentiment. The implied volatility on MSTR is among the highest of any large-cap stock, which historically produced enormous distributions.
MSTY once paid as much as $4.42 per share in a single monthly distribution, a figure that made it one of the highest-yielding ETFs on the market. But that income came at a cost — by early 2026, those distributions have compressed to weekly payments in the $0.30 to $0.43 range, and the share price has declined about 45% over the past year over the past year to around $24, illustrating how NAV erosion can quietly undermine even the most generous payout schedule. That is the most severe NAV erosion in this group, and it illustrates the risk of chasing yield on a fund tied to a single company whose value is almost entirely driven by the price of a single volatile asset.
The Real Catch: Total Return, Not Just Yield
The headline catch with all four of these funds is that distributions alone do not tell you whether you made money. What matters is total return: share price change plus income collected. CONY and MSTY have seen meaningful share price declines over the past year, which means investors need to have collected enough in distributions to come out ahead. NVDY and TSLY have seen price appreciation over the same period, which changes the math considerably.
The other catch is that distributions are not guaranteed and are not traditional dividends. They come from options premium, which rises and falls with volatility. When volatility drops, as it did in late 2025 when the VIX briefly fell to 13.47, distributions compress. The current elevated VIX environment is boosting payouts right now, but that environment will not last indefinitely.
Each of these funds is tied to a different reference asset with its own volatility profile. NVDY is linked to NVIDIA and AI infrastructure sentiment. TSLY is tied to Tesla’s historically high implied volatility. CONY and MSTY are connected to crypto-correlated assets, which historically produce the highest distributions but also the most severe NAV erosion. In all four cases, total return — share price change plus income collected — is the only complete measure of whether the strategy has delivered value.
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