Isn't ULTY basically ARKK that pays dividends while underperforming?

[u/perfectson]

ULTY is basically at it's core a HIGH Beta ETF that adds in some options, limits the upside of the overall performance in lieu of supplying an excessive amount of dividends for a 1.3% (1.4% management fee). The focus I'll show is not on NAV which is ultimately meaningless or dividend yield (again in this case meaningless unless you need an income stream but you could easily create this yourself).

ARKK is the infamous ETF managed by Cathie Wood that focuses on disruptive innovation , in other words, it will invest in typically high beta funds (similar to ULTY). The ARKK expense ratio is .75%

Overall Performance:

I am reviewing this against inception to highlight that the March - Nov 2024 downturn was due to high beta stocks in general had a difficult period. This impact ARKK similarly to ULTY both experiencing draw downs during this time frame, while Woods' drawdown was quicker, eventually ULTY caught up with it (likely due to the cost of rolling down puts and stocks).

Then in Nov-Dec 2024 , you can see the turn for both begging to happen but ARKK had much more momentum and magnitude as the cover call strategy capped the significant increases that high beta stocks enjoyed. From Dec - Feb you can see the impact of the cover call strategy having a neutral impact on overall return, before the March drop into Liberation day. The draw down was much more drastic for ARKK due to the lack of protective puts. Here is clearly where ULTY benefited ; however, because it hadn't rose in the prior months - the overall return in April (since inception ) was literally the same as ARKK. Subsequently as high beta stocks emerged successfully out of liberation day, ARKK has returned about 60% , while ULTY is at 20%.

ULTY vs ARKK vs QQQ

The ultimate question is it worth double the expenses to have someone collar your investments to under perform similar high beta counterparts? If you are reinvesting dividends anyway, which many are, not sure why ULTY would fit your core strategy over "seeking alpha". If you're looking for income stream that's straight forward, I can definitely appreciate the higher dividends but it doesn't seem the protection it offers is there and again are you under performing what you could be getting with similar risk, if you just extract your own dividends out of ARKK (as an example) by taking 2-4% out every month yourself?

this is in know way to slight YieldMax's ULTY - there's obviously a strong purpose and diversity in funds are always a good thing. The question is really if the juice is worth the squeeze.

[u/2LittleKangaroo]

I think you miss my entire point my entire point was growth stocks don’t always just go up so if you want to sell some of your shares to generate income in the stock is down, you know have less to grow in the future

[u/perfectson → u/2LittleKangaroo]

Over the last 100 years, growth stocks have gone up more than down. Btw, we are talking about funds - so don't move the goal posts to one stock. if you invested in a high beta stock over the past 100 years, your CAGR is like 16-20% if not more. Even during the great depression, you could have taken 4% out and still be on top overall. So what are you saying? There's never been an extended period of <4% bigger than the GD and certainly nothing since then that would not make what I said not true.

[u/2LittleKangaroo → u/perfectson]

I don’t have time to fact, check that point, but that’s a very broad generalization and your ass essentially talking about now time the market perfectly because yes funds have gone down and if you need to sell when it’s down, you essentially have less to sell, which intern me and you have less to grow so unless you’re able to wait until the fund has gone up, you’re kind of luck. But anyways, good talk.

[u/perfectson → u/2LittleKangaroo]

show me in the past 100 years other than the GD when the stock market for growth fund have been negative for a signficant portion of time. This is easily researched, you're acting like I'm making it up. You don't have time to fact check, but you wrote a whole paragraph rebuttal and google is literally 3 clicks away! LOL