Roundhill Investments Announces XDTE, QDTE and RDTE Distributions for September 27, 2024

Rhea-AI Summary

Roundhill Investments has announced ETF distributions for XDTE, QDTE, and RDTE for September 27, 2024. The distribution details are as follows:

• XDTE (S&P 500 0DTE Covered Call Strategy ETF): 0.37% ($0.188100 per share)
• QDTE (Innovation-100 0DTE Covered Call Strategy ETF): 0.62% ($0.256747 per share)
• RDTE (Small Cap 0DTE Covered Call Strategy ETF): 0.82% ($0.360323 per share)

The ex-date is September 26, 2024, and the pay date is September 27, 2024. The 30-Day SEC Yields for XDTE and QDTE are -0.46% and -0.40% respectively, while RDTE's yield is not yet available. All three funds have a Gross Expense Ratio of 0.95%.

Positive

• QDTE offers the highest distribution per share at $0.256747
• RDTE provides the highest distribution percentage at 0.82%

Negative

• XDTE and QDTE have negative 30-Day SEC Yields (-0.46% and -0.40% respectively)
• All three funds have a relatively high Gross Expense Ratio of 0.95%

Insights

Financial Analyst

The announced distributions for Roundhill's 0DTE (zero days to expiration) covered call ETFs provide insight into their income-generating capabilities. XDTE, QDTE and RDTE are offering distribution yields of 0.37%, 0.62% and 0.82% respectively. These weekly distributions can be attractive for income-seeking investors.

However, it's important to note the negative 30-day SEC yields for XDTE (-0.46%) and QDTE (-0.40%). This suggests that the funds' recent income generation has been lower than their expenses, which could be a concern for long-term sustainability. The high expense ratio of 0.95% for all three funds is also a factor that may impact overall returns.

Investors should be cautious about the funds' statement regarding distributions potentially exceeding income and gains, which could result in return of capital. This may have tax implications and could erode the NAV over time if not supported by fund performance.

Options Trading Specialist

The 0DTE covered call strategy employed by these ETFs is a sophisticated approach aimed at generating income through options premiums. The strategy involves selling call options that expire the same day, potentially capitalizing on rapid time decay. This can lead to more frequent distributions but also carries unique risks.

The varying distribution rates among the funds (0.37% for S&P 500, 0.62% for Innovation-100 and 0.82% for Small Cap) likely reflect differences in underlying volatility and option premiums available in these market segments. Small-cap stocks typically offer higher option premiums due to greater volatility, explaining RDTE's higher distribution rate.

However, the negative SEC yields are a red flag, indicating that recent option premium income hasn't covered fund expenses. This could be due to low market volatility or unfavorable price movements in the underlying assets. Investors should monitor how these funds perform in different market conditions to assess the strategy's effectiveness.

NEW YORK, Sept. 25, 2024 /PRNewswire/ -- Roundhill Investments, an ETF sponsor focused on innovative financial products, has announced the following ETF distributions for XDTE, QDTE, and RDTE.

Fund Name	Ticker	Distribution Per Share (%)*	Distribution Per Share	30-Day SEC Yield**	Ex-Date	Pay Date
Roundhill S&P 500 0DTE Covered Call Strategy ETF	XDTE	0.37 %	$0.188100	-0.46 %	9/26/24	9/27/24
Roundhill Innovation-100 0DTE Covered Call Strategy ETF	QDTE	0.62 %	$0.256747	-0.40 %	9/26/24	9/27/24
Roundhill Small Cap 0DTE Covered Call Strategy ETF	RDTE	0.82 %	$0.360323	N/A	9/26/24	9/27/24

 

The 30-Day SEC Yield** (as of 8/31/24) for the Roundhill S&P 500® 0DTE Covered Call Strategy ETF and the Roundhill Innovation-100 0DTE Covered Call Strategy ETF are -0.46% and -0.40%, respectively.***

The 30-Day SEC Yield** for the Roundhill Small Cap 0DTE Covered Call Strategy ETF was not yet available.

The Gross Expense Ratio for XDTE, QDTE and RDTE is 0.95%.

The performance data quoted represents past performance. Past performance does not guarantee future results. Current performance may be lower or higher than the performance data quoted. The investment return and principal value of an investment will fluctuate so that an investor's shares, when sold or redeemed, may be worth more or less than their original cost. Returns less than one year are not annualized. For the most recent standardized and month-end performance, please click here: XDTE, QDTE, RDTE.

The Funds currently expect, but do not guarantee, to make distributions on a weekly basis. Distributions may exceed the Funds' income and gains for the Funds' taxable year. Distributions in excess of the Funds' current and accumulated earnings and profits will be treated as a return of capital. Distribution rates caused by unusually favorable market conditions may not be sustainable. Such conditions might not continue to exist and there should be no expectation that this performance will be repeated in the future. Please see the Supplemental Tax Information section of the webpage for more information on the distribution composition including the estimated return of capital.

*The Distribution Per Share (%) is calculated by dividing the most recent distribution by the fund NAV as of market close on 9/13/24.

**30-Day SEC Yield: Yield calculation that reflects the dividends and interest earned during the period after the deduction of the fund's expenses. It is also referred to as the "standardized yield".

About Roundhill Investments:

Founded in 2018, Roundhill Investments is an SEC-registered investment advisor focused on innovative exchange-traded funds. Roundhill's suite of ETFs offers distinct and differentiated exposures across thematic equity, options income, and trading vehicles. Roundhill offers a depth of ETF knowledge and experience, as the team has collectively launched more than 100+ ETFs including several first-to-market products. To learn more about the company, please visit roundhillinvestments.com.

This material must be preceded or accompanied by a prospectus.

Click here for the QDTE prospectus.
Click here for the XDTE prospectus.
Click here for the RDTE prospectus. 

All investing involves risk, including the risk of loss of principal. There is no guarantee the investment strategy will be successful. The funds faces numerous risks, including options risk, liquidity risk, market risk, cost of futures investment risk, clearing broker risk, commodity regulatory risk, futures contract risk, active management risk, active market risk, clearing broker risk, credit risk, derivatives risk, legislation and litigation risk, operational risk, trading issues risk, valuation risk and non-diversification risk. For a detailed list of fund risks see the prospectus.

Covered Call Strategy Risk. A covered call strategy involves writing (selling) covered call options in return for the receipt of premiums. The seller of the option gives up the opportunity to benefit from price increases in the underlying instrument above the exercise price of the options, but continues to bear the risk of underlying instrument price declines. The premiums received from the options may not be sufficient to offset any losses sustained from underlying instrument price declines, over time. As a result, the risks associated with writing covered call options may be similar to the risks associated with writing put options. Exchanges may suspend the trading of options during periods of abnormal market volatility. Suspension of trading may mean that an option seller is unable to sell options at a time that may be desirable or advantageous to do.

Flex Options Risk. The Fund will utilize FLEX Options issued and guaranteed for settlement by the Options Clearing Corporation (OCC). In the unlikely event that the OCC becomes insolvent or is otherwise unable to meet its settlement obligations, the Fund could suffer significant losses. Additionally, FLEX Options may be less liquid than standard options. In a less liquid market for the FLEX Options, the Fund may have difficulty closing out certain FLEX Options positions at desired times and prices. The values of FLEX Options do not increase or decrease at the same rate as the reference asset and may vary due to factors other than the price of reference asset.

0DTE Options Risk.*** The Fund's use of zero days to expiration, known as "0DTE" options, presents additional risks. Due to the short time until their expiration, 0DTE options are more sensitive to sudden price movements and market volatility than options with more time until expiration. Because of this, the timing of trades utilizing 0DTE options becomes more critical. Although the Fund intends to enter into 0DTE options trades on market open, or shortly thereafter, even a slight delay in the execution of these trades can significantly impact the outcome of the trade. Such options may also suffer from low liquidity, making it more difficult for the Fund to enter into its positions each morning at desired prices. The bid-ask spreads on 0DTE options can be wider than with traditional options, increasing the Fund's transaction costs and negatively affecting its returns. Additionally, the proliferation of 0DTE options is relatively new and may therefore be subject to rule changes and operational frictions. To the extent that the OCC enacts new rules relating to 0DTE options that make it impractical or impossible for the Fund to utilize 0DTE options to effectuate its investment strategy, it may instead utilize options with the shortest remaining maturity available or it may utilize swap agreements to provide the desired exposure.

Roundhill Financial Inc. serves as the investment advisor. The Funds are distributed by Foreside Fund Services, LLC which is not affiliated with Roundhill Financial Inc., U.S. Bank, or any of their affiliates.

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SOURCE Roundhill Investments

FAQ

What is the distribution amount for QDTE on September 27, 2024?

The distribution amount for QDTE (Roundhill Innovation-100 0DTE Covered Call Strategy ETF) on September 27, 2024, is $0.256747 per share, which represents 0.62% of the fund's NAV.

When is the ex-date for the QDTE distribution announced on September 25, 2024?

The ex-date for the QDTE distribution announced on September 25, 2024, is September 26, 2024.

What is the 30-Day SEC Yield for QDTE as of August 31, 2024?

The 30-Day SEC Yield for QDTE (Roundhill Innovation-100 0DTE Covered Call Strategy ETF) as of August 31, 2024, is -0.40%.

What is the Gross Expense Ratio for QDTE?

The Gross Expense Ratio for QDTE, as well as for XDTE and RDTE, is 0.95%.