My Favorite Covered Call ETF Is Overhauling How It Works. It’s a Big Win for Income Investors.

I like some ETFs because they reach into far-flung corners of the markets. Others are attractive because they take a specific major index, such as the S&P 500 Index ($SPX), and carve out a useful segment of it (top 50 stocks, low volatility stocks, any of the 11 economic sectors, etc.). But with the iShares 20+ Year Treasury Bond BuyWrite Strategy ETF (TLTW), it is even more simple than that.

It is a one-click, one-trade way to own what is essentially a iShares 20+ Year Treasury Bond ETF (TLT)-like bond ETF portfolio, and have monthly covered call writing as an overlay to boot. Could I just write the calls myself? Of course. Are there times where I’m really just “renting” TLTW, and thus prefer to own it instead of messing with the options? Sure.