Important Disclosure. For accredited and professional investors only. This page is informational and not an offer, solicitation, or recommendation. Any investment is made by definitive documents only.
Covered Call ETFs, Managed For You: 12–16% Target Distribution, With NAV Control
We run a managed covered-call ETF mandate with a target distribution range of 12–16% per annum while focusing on NAV preservation. The approach is straightforward: select liquid covered-call ETFs, apply strike and tenor rules that respect drawdown limits, add hedges when needed, and rebalance on a set cadence. The objective is dependable cash flow with tighter control of NAV drag than a passive buy-write.
What You Get
Income Target
12–16% distribution target sourced from option premia and ETF payouts. Targets are not guarantees; we adjust sizing to market volatility.
NAV Control
Rules for strike selection, roll timing, and cash buffers to limit grind from persistent overwriting and equity drifts.
Risk Guardrails
Portfolio-level drawdown thresholds, position limits, issuer concentration caps, and liquidity screens by ADV and spread.
Transparent Reporting
Monthly distribution, attribution, and risk buckets; roll logs; delta and coverage summaries; realized vs implied variance checks.
How We Manage NAV Drag
Strike & Delta Rules
Systematic strike bands (e.g., 10–30Δ) with adjustments for skew and earnings/macro windows. Tighter bands in low vol; wider when vol compensates.
Tenor & Roll Discipline
Short tenors for faster gamma capture; roll early when carry decays. Avoid forced rolls into illiquid expiries.
Hedging Overlays
Tactically add collars or puts at pre-set drawdown triggers to defend NAV during sharp moves.
Cash & T-Bills
Hold a small cash/T-bill buffer to fund hedges and smooth distributions without selling into weakness.
Process
Universe focuses on liquid covered-call ETFs across major indices and sectors. No thinly traded products.
Portfolio Construction
| Dimension | Our Approach |
|---|---|
| ETF Selection | Large, liquid covered-call ETFs with transparent methodology, stable distributions, and sufficient options depth. |
| Position Sizing | Max single-ETF exposure bands; sector and factor diversification to reduce path dependency. |
| Option Coverage | Dynamic overwrite (40–100%) based on regime and target cash flow; collars when risk rises. |
| Rebalance Cadence | Monthly base cycle with event-driven adjustments for volatility spikes or regime shifts. |
| Liquidity & Costs | ADV screens, spread limits, and broker routing to keep slippage and impact contained. |
Who This Suits
Income-Focused Accredited Investors
Seeking a defined distribution target with professional risk control and clear reporting.
RIAs & Family Offices
Looking to outsource an overwrite sleeve with rules, capacity limits, and audit-ready logs.
Team & Track Record
Hard Skills
Options portfolio managers and execution traders (CFA/FRM) , quants with Python/R and risk engines, and a compliance lead. Live desk experience in index and single-name options, ETF microstructure, and T-bill cash management.
What We’ve Delivered
Team members have managed option-income sleeves through calm and stressed markets, maintained distribution targets within stated ranges across regimes, and reduced realized drawdowns vs naïve buy-write baselines by applying disciplined roll and hedge rules. Results vary by period; targets are not guaranteed.
Access & Fees
| Item | Details |
|---|---|
| Vehicle | Separate account or private mandate; minimums apply. |
| Eligibility | Accredited or professional investors; onboarding and KYC required. |
| Fees | Management and performance terms set in mandate documents; all ETF expense ratios and trading costs borne by the account. |
| Reporting | Monthly statements and risk reports; quarterly reviews on request. |
Discuss A Managed Covered-Call ETF Mandate
Walk through the process, guardrails, and reporting. See how we target 12–16% distributions while managing NAV drag.
Explore Fixed-Income SolutionsFAQs
Is 12–16% guaranteed?
No. It is a target range. Distributions depend on market volatility, option premia, and portfolio positioning.
What about NAV erosion?
We address it with strike/tenor rules, cash buffers, and hedges. Equity markets can still pull NAV lower; controls seek to limit, not eliminate, drawdowns.
What are the main risks?
Equity risk, option assignment, volatility regime shifts, liquidity, tracking, and tax treatment. Loss of principal is possible.
Taxes?
Distributions may include option premium and return of capital. Tax outcomes vary by investor; consult an advisor.
Disclaimers. Targets are objectives, not promises. Past performance does not guarantee future results. Option strategies involve risk and can result in losses. Distributions may vary and can include return of capital. ETFs carry management fees and tracking risk. This is not investment advice. Any offering or mandate is made by formal agreements and a final statement of terms. Not FDIC insured. May lose value. Investing involves risk, including possible loss of principal.
