Goldman Sachs' covered-call ETF (GPIQ) fell 6.1% in July, underperforming Apple's 15.23% surge due to its options strategy
Despite Apple (AAPL), its largest single holding, soaring 15.23% in July on strong earnings, the Goldman Sachs Nasdaq-100 Core Premium Income ETF (GPIQ) declined by 6.1% during the same period. This underperformance is attributed to GPIQ's covered-call strategy, which sells call options against its portfolio to generate premium income. When underlying stocks like Apple rally significantly past the option strike price, the fund owes the option buyers the difference, effectively handing the gains to them rather than shareholders. Since its inception in October 2023, GPIQ's total return with distributions reinvested is 89.08%, slightly trailing the Invesco QQQ Trust (QQQ)'s 89.21% price-only return over a similar period.
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