Tidal Trust II - YieldMax TSLA Option Income Strategy ETF (TSLY)TSLY

ETF Tidal Trust II - YieldMax TSLA Option Income Strategy ETF

Profile:

Tidal Trust II (TILDS), also known as YieldMax TSLA Option Income Strategy, is a actively managed ETF focusing on generating high option-based income through selling covered call options on Tesla stock. It does not invest directly in Tesla stock but relies on the options strategy to achieve its objective.

Objective:

TILDS aims to deliver high current income and minimize capital appreciation. It targets investors seeking a consistent income stream from their investment in the electric car giant Tesla.

Issuer:

Tidal ETF Trust II is the issuer, established and managed by Tidal ETF Management (US), Inc.

Reputation and Reliability:

Tidal is a relatively young ETF provider, launched in 2022. It has limited track records compared to established ETF issuers. However, the fund manager, Tidal ETF Management, has experience and expertise in options strategies.

Market Share:

TILDS is a niche ETF with a limited market share in the options-focused ETF space.

Total Net Assets:

As of September 30, 2023, TILDS has approximately USD $10 million in assets under management.

Moat:

TILDS differentiates itself by focusing solely on Tesla options, offering an alternative to directly holding Tesla stock for income. However, this niche focus also increases its sensitivity to Tesla's performance and options market volatility.

Financial Performance:

TILDS has a short track record, launched on June 13th, 2023. Its performance since inception has been positive, delivering an annualized return of approximately 10%. However, it is essential to note that past performance is not indicative of future results.

Benchmark Comparison:

TILDS does not track a specific index but aims to outperform the S&P 500 in terms of income generation.

Growth Trajectory:

Given its recent inception, TILDS's growth trajectory remains uncertain. The success will likely depend on its ability to maintain a consistent high-income stream and attract investors seeking this specific strategy.

Liquidity:

TILDS has an average trading volume of around 10,000 shares daily, indicating moderate liquidity. The bid-ask spread is around 0.2%, representing a relatively low trading cost.

Market Dynamics:

Market factors influencing TILDS include Tesla's stock price volatility, interest rate fluctuations impacting options pricing, and overall market sentiment towards electric vehicles and technology stocks.

Competitors:

TILDS faces competition from other actively managed options ETFs focusing on specific stocks or sectors. Some competitors include:

• Global X S&P 500 Covered Call ETF (XYLD)
• Invesco S&P 500 BuyWrite ETF (PBP)
• iShares International Select Dividend ETF (IDV)

Expense Ratio:

TILDS has an expense ratio of 1.20%, covering the fund management and operational costs.

Investment approach and strategy:

Strategy: TILDS actively manages its portfolio and sells covered calls on Tesla stock to collect premium income. Composition: While TILDS does not invest directly in Tesla shares, its underlying assets are Tesla call options contracts.

Key Points:

• High income generation potential
• Focuses exclusively on Tesla options
• Actively managed strategy
• Short track record
• Moderate liquidity

Risks:

Volatility: TILDS is exposed to Tesla stock price fluctuations and options market volatility. Market Risk: The fund's performance is highly dependent on Tesla's stock performance and the overall options market sentiment. Limited Diversification: The concentrated focus on Tesla increases its risk exposure compared to diversified ETFs.

Who Should Consider Investing:

• Investors seeking high current income from Tesla exposure.
• Investors comfortable with short track record and concentrated investment strategy.
• Investors understanding the risks associated with options trading and market volatility.

Fundamental Rating Based on AI: 6.5

TILDS receives an AI-based fundamental rating of 6.5 out of 10. This rating considers factors such as its short operational history, niche market focus, moderate liquidity, and reliance on Tesla's performance and options market conditions. While the potential for high income is appealing, investors must carefully evaluate the risks involved before investing.

Resources and Disclaimers:

Resources:

• Tidal Trust II website: https://yieldmax.com/yieldmax_tsla
• ETF.com Profile: https://www.etf.com/TILDS
• Seeking Alpha: https://seekingalpha.com/symbol/TILDS

Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. Please consult a financial professional for personalized advice.