Roundhill's XDTE ETF, selling 0DTE options and paying weekly distributions, has outperformed the S&P 500 with a projected 25.93% distribution rate. XDTE's strategy uses out-of-the-money 0DTE covered calls, which can capture more upside and yield compared to traditional monthly options. Limited history and potential volatility in bear markets warrant cautious investment for income-focused portfolios.
Actively managed ETFs, like XDTE, are gaining popularity, with assets expected to exceed $1 trillion by year-end. XDTE sells zero-day expiry options on the S&P 500, generating income but carrying risk, especially during market downside gaps. XDTE has outperformed the S&P 500 ETF since inception, benefiting from recent high volatility and a trendless market environment.