GPIQ ETF

The Goldman Sachs Nasdaq-100 Core Premium Income ETF uses an options overlay to boost yield, targeting investors bullish on the Nasdaq-100. GPIQ's holdings are concentrated in Information Technology (49.64%), Communication Services (16.16%), and Consumer Discretionary (14.59%), focusing on growth-driven companies. Compared to other Nasdaq-100 ETFs, GPIQ's call options strategy provides steadier income, but may limit gains in strong markets.

GPIQ uses an options strategy to enhance yield by writing call options on the NASDAQ-100 Index. By writing covered calls on only a portion of its long positions, the fund retains upside potential on the remaining, uncovered positions. The fund offers a 10% distribution yield while maintaining upside potential in its underlying holdings.

I rate GPIQ as a Buy due to its stellar performance, on target to distribute a 10.5% yield with strong capital appreciation and total returns. GPIQ's strategy involves selling at-the-money call options on 25-75% of its NASDAQ 100 portfolio, adjusted monthly based on market conditions. Limited history and lack of information about options strategy specifics from the management team pose a risk. Performance so far, however, has been good.

GPIQ: So Far So Good In This New Fund

Goldman Sachs has launched two covered call funds, GPIX and GPIQ, as direct competition to JPMorgan's highly popular funds JEPI and JEPQ. These funds write covered calls partially against their portfolio holdings (25% to 75%), allowing them to participate in some market upside. The funds will use FLEX Options instead of ELNs for premiums, offering price stability and negotiation flexibility.