One Fund Bundles Wall Street’s Weekly Payers, Yields ~50%, and Is Actually Up This Year
Two funds both pay weekly yields pushing 50% from nearly identical single-stock baskets, but one has quietly destroyed principal all year while the other has not, and the reason comes down to a structural difference most income investors never think…
Owners of the YieldMax Universe Fund of Option Income ETFs (NYSEARCA:YMAX) bought it for a clear reason: it bundles roughly two dozen YieldMax single-stock covered-call ETFs into one ticker, pays weekly, and advertises a distribution rate deep into triple-digit-adjacent territory. YMAX solves the problem of picking which single-stock synthetic income fund to hold, and it lets an income-focused portfolio compound distributions weekly. The problem is what the wrapper hides: this year, the yield screens spectacularly, but the underlying covered-call sleeves have bled NAV, so YMAX’s total return is negative. A different weekly-pay fund of funds, built on a structurally different engine, has held up.
Why YMAX Falls Short When Mega-Caps Rally
The underlying sleeves in this fund overwhelmingly write calls on single stocks. Selling calls caps your upside participation on rallies while doing absolutely nothing to blunt drawdowns on the downside. Over long stretches of rising mega-cap performance, that mechanism grinds NAV lower even as distributions stay elevated, because a portion of each payout is actually a return of capital rather than earned income. In a year when the largest S&P 500 names have led the market higher, this fund has captured the premium but surrendered the appreciation. The distribution rate looks the same on the fact sheet, but the share price has moved the wrong way, and a headline yield propped up by return of capital is one of the warning signs we cataloged in a free dividend trap guide here.
Roundhill’s Top WeeklyPay ETF Uses a Different Engine
The Roundhill Top WeeklyPay ETF (NYSEARCA:TOPW), renamed from WPAY in March 2026, is built the same way at the wrapper level: a fund of eleven Roundhill WeeklyPay single-stock ETFs tied to the largest S&P 500 names, plus a small government-money-market sleeve. Each WeeklyPay fund uses a synthetic 1.2x weekly-reset exposure to its target stock and pays weekly distributions, funded by swap gains and cash yield. When the underlying rallies, the sleeve participates on a leveraged basis instead of trading away the gain for premium.
The top holdings in this fund tell you everything you need to know. NVDW sits at 14.8% of assets, AAPW at 13.9%, MSFW at 11.8%, AMZW at 10.3%, and GOOW at 9.0%, so you are really looking at a levered mega-cap basket with a weekly distribution overlay. In 2026, with mega-caps grinding higher, the underlying leverage has more than offset the payout drag. The fund is up about 6.0% year-to-date on a total-return basis, while trailing 12-month distributions total $5.749 per share, which pencils out to a trailing distribution yield near 49.8% at the current $33.04 share price. Assets under management sit at roughly $149 million, up sharply from a much smaller base earlier in the year.
What the Swap Actually Buys You This Year
Both funds pay weekly and advertise distribution rates in the same neighborhood. Year-to-date total return is the clearest scoreboard: TOPW’s leveraged, non-call-writing structure has produced a positive number, while YMAX’s covered-call structure has produced a negative one. That edge is entirely a function of the market path. Leverage cuts both ways. If the largest S&P 500 names sold off 20% in a quarter, TOPW would fall harder than YMAX. The switch bets that mega-cap leadership and low-to-moderate volatility persist.
Tradeoffs Worth Naming Before Switching
- Both funds distribute a meaningful return of capital. That defers tax at ordinary rates but reduces cost basis, raising the eventual capital-gain bill on any sale.
- TOPW’s 1.2x weekly reset is path-dependent. In a choppy sideways market, resets can erode NAV even if the underlying finishes flat over the period.
- Concentration is real. About 60% of assets sit in the top five sleeves, all mega-cap tech-adjacent. Investors already holding a Nasdaq-100 or Magnificent Seven basket are doubling up on the same names.
- Selling YMAX in a taxable account may harvest a loss that is usable elsewhere; cost basis is worth checking first, since distribution-heavy funds can have unexpected basis math.
Practical Path if the Swap Fits
If your thesis in the broader option-income fund was weekly income from a diversified basket of high-yield option ETFs, the leveraged fund offers the same basic idea but with a completely different engine under the hood. A full swap only makes sense if you are comfortable with the leveraged single-stock synthetic exposure that comes with it. A partial swap, where you keep some of the broader fund for its wider range of underlyings while adding the leveraged fund for a mega-cap lean, helps preserve diversification across both approaches. In a tax-advantaged account, making that switch costs you nothing in taxes. In a taxable account, you could harvest any losses sitting in the broader fund and stagger your entries into the leveraged fund across a few weekly ex-dates instead of buying it all at one price.
What Holders Should Weigh Right Now
The case for TOPW over YMAX rests on one observable fact: in 2026, the alternative has paid a comparable weekly yield and preserved principal, while the incumbent has not. That is a real edge as long as mega-cap leadership continues. If leadership rotates or reverses, TOPW’s leverage will hurt more than YMAX’s call-writing will help. The swap is worth evaluating for holders whose primary goal is weekly income without watching NAV bleed, less so for those relying on YMAX’s broader single-stock diversification. Position size tends to reflect the drawdown that can be held through rather than the distribution rate on the current fact sheet.
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David Beren has been a Flywheel Publishing contributor since 2022. Writing for 24/7 Wall St. since 2023, David loves to write about topics of all shapes and sizes. As a technology expert, David focuses heavily on consumer electronics brands, automobiles, and general technology. He has previously written for LifeWire, formerly About.com. As a part-time freelance writer, David’s “day job” has been working on and leading social media for multiple Fortune 100 brands. David loves the flexibility of this field and its ability to reach customers exactly where they like to spend their time. Additionally, David previously published his own blog, TmoNews.com, which reached 3 million readers in its first year. In addition to freelance and social media work, David loves to spend time with his family and children and relive the glory days of video game consoles by playing any retro game console he can get his hands on.
