The fund holds the stocks in the Nasdaq 100 Index and follows a covered call strategy, selling one-month at-the-money call options on about half of the portfolio. The other half, which has no options written against it, participates fully in the index's gains.

It suits income-and-growth investors who want option-premium-based income while keeping some of the Nasdaq 100's upside potential.

It is a passively managed (index-tracking) ETF run by Global X.

While holding the Nasdaq 100 constituent stocks, the fund sells at-the-money call options every month on about half of the portfolio's value. It seeks premium income from the half on which options are sold and participation in index gains from the half on which they are not, aiming for a balance between income and growth.

• Limits the covered call share to half, preserving room to participate in upside
• Monthly distributions based on option premiums

Assets under management (AUM) stand at $185.1M, and the expense ratio is 0.35% per year.

Compared with QYLD, which is fully covered call, it offers greater upside participation but a lower distribution yield, and its strategy structure also differs from actively managed option-based income ETFs.

The fund is affected both by the movement of the underlying Nasdaq 100 assets and by option premiums, and higher volatility tends to bring in larger option premiums. Depending on the market trend, the relative contributions of upside participation and distribution income vary.

In periods of strong demand for income, money tends to flow into covered call ETFs as a group, and because of its hybrid structure, this fund draws demand from investors positioned between pure income and growth products. Fund flows may change depending on interest rates and the volatility of technology stocks.

Its strength is a structure that balances income and upside participation, while its weakness is that gains are limited in bull markets compared with a pure index-tracking fund.

QYLD, shown in the table, runs the same Nasdaq 100 as a fully covered call strategy, which gives it a higher distribution yield but limits upside participation. ETFs such as JEPQ and JEPI are income products that actively manage exposure to the Nasdaq and the S&P 500. You can also consider XYLG, the same manager's partial covered call fund on the S&P 500, and QQQ if you want to track the Nasdaq 100 directly without an options strategy.

These are the points to review before investing in QYLG. Given the compromise structure of a partial covered call, it is important to thoroughly check in advance the balance among distribution yield, upside participation, and long-term holding costs.

The main sources of fluctuation are the capped upside in bull markets and the technology-stock concentration that is characteristic of the Nasdaq 100. Option premiums partly cushion declines, but they do not fully protect against losses when the underlying assets plunge.

It is a suitable choice for investors who want to balance income with participation in growth. If you want a higher distribution, QYLD can be considered as an alternative, and if you want pure upside participation without options, QQQ can be considered.