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Moreover, QDT's fund managers sell zero days to expiration (DTE) call options on the NASDAQ 100 daily. This innovative tactic is key in generating daily premium income, which enables the ETF to distribute dividends on a weekly basis— a significant departure from the norms established by traditional covered call ETFs, which typically sell options with longer expiration periods.

Capturing Daily Volatility

The selling of zero DTE call options comes with notable benefits. First, it allows QDT to capitalize on upward market momentum and sudden pre-market movements, providing flexibility that many of its counterparts miss. Since these options are traded daily rather than once per month, the fund has the potential to capture premium income much more frequently.