Some high-yield ETFs on Wall Street advertise dividend yields exceeding 50%, but some funds are facing erosion of principal.
Some high-yield ETFs on Wall Street, such as the YieldMax NVDA Options Income Strategy ETF (NVDY), the YieldMax MSTR Options Income Strategy ETF (MSTY), and the YieldMax COIN Options Income Strategy ETF (CONY), claim dividend yields exceeding 50%, with some reaching as high as 188%. However, these funds generate returns by taking synthetic long positions and selling short-term call options, and their total returns often fail to match the advertised yields due to erosion of principal or the return of principal as “dividends.” For example, MSTY’s share price fell 70% over the past year, and its July 2026 dividend of approximately 8% consisted of a return of principal. CONY’s dividend yield reached as high as 188%, but its share price fell 52% over the same period. NVDY is an exception: its share price has risen 15% over the past year, while it has paid substantial dividends without eroding principal.
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