A 62% larger HOOY check still left holders down 6.1%

Over the past year, a holder of YieldMax's fund that sells calls on Robinhood, BHOOY, still lost 8.6% after reinvesting every check. The share price itself was down 59.7%. The sponsor posts a 100.52% distribution rate against a 2.10% 30-day SEC yield.

This week's payment went ex-dividend Thursday, September 10, at $0.5849 a share, 61.6% above the $0.362 paid a week earlier. By Friday's close the holder was still 6.1% poorer than on September 4.

That is a $118.5 million product. On the latest payment the sponsor estimated 46.18% as return of capital, the holder's own money coming back, and 53.82% as income. That is an estimate, not a 1099.

What BHOOY's 100% rate is counting

The sponsor's own footnotes settle the gap: the distribution rate annualizes one recent payment, option premiums included, and "does not represent its total return." The 30-day SEC yield is net investment income over the 30 days ended August 31, and it excludes option income. Distributions, the same release said, may include return of capital, are not guaranteed, and may be zero.

BHOOY does not own Robinhood shares. The holdings are mostly Treasury bills, used as collateral, and options on HOOD.

YieldMax describes the fund as selling call options or call spreads on Robinhood to collect premiums, and those premiums fund the weekly check. The prospectus for these single-stock option-income funds says sold calls limit how much of a rally the fund keeps and that the design still participates in the underlying stock's declines. The prospectus defines return of capital as a return of the original investment rather than income or profit, and warns that such payments may decrease net asset value, the per-share worth of the holdings, as well as the trading price over time.

On the Circle option-income fund, BCRCO, the sponsor separately put estimated return of capital at 98.35% of the latest distribution. For BCRCO the posted figures were a 100.28% distribution rate and a 1.91% SEC yield.

Group 2's checks moved. The accounts did not keep up

YieldMax posted Group 2's weekly amounts on Wednesday and called them variable, not a raise or a cut. The per-share figures moved anyway.

Four of the five funds finished the week lower. Total return is Friday, September 4 through Friday, September 11, distributions reinvested.

REX's FANG and innovation covered-call fund, BFEPI, is not in that group and still belongs on the ledger. It paid $0.41257 at the September 9 ex-date, double the $0.20516 it paid a week earlier. The shares finished Friday where they had started the window, at $42.52; counting the check, the week was up 0.50%.

BTLT gave back more than four months of coupon

Treasury's 10-year par yield was 4.96% Friday. The iShares 20+ year Treasury bond ETF, BTLT, a $47.4 billion fund, had gone ex-dividend on Tuesday, September 1, for $0.31469 a share, payable September 4. From the September 4 close through Friday the shares fell 1.6%. That price drop was more than four months of the September coupon.

The sleeve that did not give the week back was the 0-3 month Treasury ETF, ASGOV, which rose 0.05%.

BHOOY's next ex-date, and the 4% alternative

BHOOY and the rest of YieldMax's Group 2 are scheduled to go ex-dividend Thursday, September 17, payable Friday, September 18, on the same Wednesday-declare cycle as this week's check. GraniteShares' two weekly fund-of-funds go ex-dividend Monday, September 14: the top-yielders fund, FYBTY, at $0.1056 a share, and the single-stock universe fund, DYBST, at $0.10295, both payable Wednesday, September 16.

The 3-month Treasury still yields 4.07%. ASGOV was the income sleeve that did not have to give the week back to duration or to a single stock's options. A larger check does not close the account. The price does.