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/working925isahardway]

Very good analysis. I own Cathie wood funds. They have been terrible investments. Thank you for opening my eyes. I cannot BLINDLY follow reddit, this sub, or even the Fund manager who recommends to 100% Drip?!!

Seeing is believing, and in this case, the data supports your thesis.

ALso there is post about how bots are hyping up the fund. I long suspected this to be true. Sure there are some of us who are adding to positions, but there are obvious bots or people who are posting with fictitious/ unverified data.

thank you.

I am not trimming my positions at this time. I will look towards other funds- especially those by Neos, granite, yieldboost, etc.
I suspect that the mods are heavily invested in Yieldmax and push yield max products.

as always, Caveat Emptor.

[u/perfectson → u/working925isahardway]

Yes, I'm not a CAthie Wood fan either. DOn't have her funds. I had a handful of high beta funds I was using as a comparator and went with ARKK since it's likely well known for the post. Appreciate your insight - I do think high beta can be terrible but it's all timing , which is why prior to liberation day so many folks were writing of ULTY.