KNG vs OVS

KNGAFT Cboe Vest S&P 500 Dividend Aristocrats Target Income ETF

OVSCOverlay Shares Small Cap Equity ETF

In short

KNG Dividend Aristocrats with an income motor bolted on. KNG equal-weights the S&P 500's 25-year dividend raisers, then sells calls on each stock, sized by rule to hit an income target above the index's yield. Monthly payer since 2018.

OVS Small caps with an options overlay, and the overlay sells puts instead of calls. OVS pairs an actively picked US small-cap portfolio with short-term listed put writing for income, measured against the S&P SmallCap 600.

Stated mandate

KNG The Fund seeks to track the price and yield of the Cboe S&P 500 Dividend Aristocrats Target Income Index Monthly Series before fees and expenses.

OVS The Fund seeks total return through active U.S. small-cap equity exposure and a listed short-term put-option overlay intended to generate income.

Why people hold it

• KNG Base portfolio is the S&P 500 Dividend Aristocrats: roughly 140 companies that have raised dividends for at least 25 straight years, held equal-weighted instead of by market cap.cboe.com
• The overlay is written stock by stock, not as one index-level call, and the call count floats by rule to chase an income target set against the S&P 500's dividend yield.sec.govcboe.com
• Calls cover only part of each position, so a slice of every holding stays uncapped. Income lands monthly.sec.gov
• Running since 2018, well before the covered-call crowd showed up, and one of the stronger implementations in its peer group.

• OVS The overlay writes short-term listed puts rather than covered calls, so income comes from a separate options sleeve instead of capping gains on the small-cap holdings.
• Stock selection is active, with the S&P SmallCap 600 total return index as the yardstick rather than a mandate to copy it holding for holding.
• Exchange-listed options, not over-the-counter contracts, inside a plain 1940 Act ETF wrapper (1099 tax reporting, no K-1).
• Live since 2019, so the strategy has run through real small-cap booms and drawdowns, not just a backtest.

Worth knowing

• KNG Calls cap the upside on the covered portion of each stock, so in a fast rally those shares can lag the Aristocrats the fund holds outright.sec.gov
• Coverage floats with option pricing, so how much of the portfolio is written against (and how much upside stays open) shifts over time.cboe.comsec.gov
• Distributions can include return of capital, which trims your cost basis. At 0.74%, the fee sits about level with the 0.75% cohort median, and it prices like an options strategy.

• OVS At 0.83% a year it sits above the middle of the option-income overlay group on cost, and that hurdle applies whatever the put sleeve collects.
• A small fund that trades thinly. Spreads can widen and sizeable orders can push the price, which makes limit orders the practical default.
• Distributions come on an irregular schedule, not a fixed monthly rhythm. And short puts lose in the same selloffs that hit small caps, so the two exposures stack.

Full KNG profile⁠

Full OVS profile⁠