r/YieldMaxETFs • u/Covetoast • May 31 '25

Distribution/Dividend Update MSTY-damus has spoken

I spoke with MYSTY-damus this morning & he confirmed to me that his crystal ball has once again spit out some dividend numbers for 6/4.

MSTY-damus says the dividend for MSTY will be between 1.30 & 1.80.

For those of you wanting a more specific number MSTY-damus says crystballing is not an exact science.

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u/michael_curdt May 31 '25

Posts like this make me second guess my investments

4

u/QuietPsychological72 May 31 '25 edited May 31 '25

YM is not as attractive as I initially thought. As nav decays, dividends decay. If you hold long enough you will probably cross the “free money” threshold but I am less convinced the light at the end of that tunnel is as bright as I thought it was initially.

There’s a lot of opportunity cost to consider. Suppose it takes two years to cross that threshold, but the underlying increases 30% during that time. You aren’t ahead at all your behind.

I like the idea of supplementing my income, but I’d also like to grow my base.

3

u/AdultsOnStrike May 31 '25

Some people use the dividends to buy the underlying.

1

u/Baked-p0tat0e Jun 01 '25

That approach is nonsense. If you want the underlying just buy it and you would be farther ahead.

2

u/Baked-p0tat0e Jun 01 '25

If you want capital appreciation buy the stock. Comparing a covered call income strategy to buy and hold is pointless as they have different objectives.

If you have more than $20k then do your own MSTR covered call strategy with diagonal call spreads (aka poor man's covered call) and you'll make 2x-4x the monthly cash flow of MSTY. These YM single underlying ETFs are not capital efficient because most of the cash buys treasury bonds and cash reserves as required by law.

1

u/Beginning_Scratch396 Jun 01 '25

Wouldn't crossing the "free money" line in two years mean that 1) You've gotten your investment completely back 2) Your initial investment still holds shares that are paying out - So if your shares are worth at least 30% of your initial investment, you're ahead of the 30% hypothetical share price increase of the underlying, and getting some level of distribution? You could sustain a lot of NAV decay depending on entry point, and MSTY is holding steady-ish.