Asking which covered call fund is “best” is really asking what you are optimizing for, because the three big names in the category each make a different trade. QQQI, the fund behind the “safe 14.1% income fund” pitch, sits in the middle: more active than the oldest fund in the group, less aggressive than the newest. Sorting out which one wins depends entirely on whether you prize current yield, total return, or something in between.

The Three Approaches

The category splits into three design philosophies. The Global X Nasdaq-100 Covered Call ETF, the fund Bryan Perry recommended back in October 2019, is the classic: it sells at-the-money calls on a fixed monthly schedule, maximizing income and capping the most upside. QQQI is the active upgrade, using call spreads and judgment about strikes to collect solid income while preserving more upside in strong months. The ProShares Nasdaq-100 High Income ETF is the newest twist, selling single-day options rather than month-out calls, which produces a lower yield but caps far less of each month’s move.

These are genuinely different products wearing the same label, and the “best” one depends on which column of the trade matters to you. We detail each mechanism in our covered call ETF explainer.

Yield vs Total Return

The headline yields tell a clear story. QQQI advertises around 14.1%, the Global X fund has historically run in the low double digits, and the ProShares fund yields around 6%. On yield alone, QQQI looks like the obvious winner, which is exactly the framing the pitch leans on.

Total return tells a messier story. Over the trailing twelve months our teardown reviewed, QQQI’s total return was about 9.3%, while the Nasdaq-100 returned about 12.6% and the Global X fund returned about 16.7%. The fund with the highest yield was not the fund with the best total return, because the funds that cap the most upside also miss the most in a rally. This is the single most useful lesson in the category: yield and return are different numbers, and chasing the first can cost you the second.

The Downside Question

When the market falls, the differences between the funds narrow, because they all own the Nasdaq-100 and all keep the downside. The premium they collect cushions the fall by a point or two, but none of them has principal protection. The ProShares fund’s lower yield comes with slightly less share-price erosion, which is its quiet advantage, but in a real drawdown all three fall together with the index.

That is why the pitch’s comparison to a certificate of deposit fails. A CD and a covered call fund sit on different risk shelves, and no amount of yield closes that gap. We make the case directly in our capital preservation piece.

The Honest Scoreboard

For an investor who wants the maximum current income and accepts the most capped upside, the Global X fund is the historical answer, though QQQI has beaten it on total return since launch. For an investor who wants income with more upside kept, QQQI’s active approach is the sensible middle. For an investor who wants the smallest yield sacrifice with index-like exposure, the ProShares fund is worth a look. There is no single winner, only a menu of trades.

QQQI earns its place as the pitch’s pick because it is a genuine improvement over the fund Perry used to recommend, and that is worth acknowledging. The error in the pitch is calling any of them “safe.” For a head-to-head of the two funds Perry has recommended across his career, see our head-to-head breakdown of the two.

How to Read the Prospectus

Comparing covered-call funds properly means reading the prospectus, and three lines matter more than the rest. The first is the expense ratio, which for an options-heavy fund like QQQI sits at 0.68%, reasonable but a real drag next to cheaper passive funds. The second is the distribution policy, which tells you whether the fund pays a fixed amount, a fixed rate, or simply distributes whatever premium it earns, and the answer changes how predictable the checks are. The third is the description of the options program itself, the strikes, the expirations, and whether the manager has discretion or follows a fixed rule.

Those three lines are where the funds actually differ, far more than in their headline yields. Two funds can both advertise 12% and behave very differently depending on how much upside each is willing to sell. The yield is the headline; the prospectus is the product. Before choosing a “best” fund, spend ten minutes on those three lines, because they explain the next five years of returns better than the current payout rate ever will.

The category rewards the investor who treats it as a menu and punishes the one who treats it as a winner-take-all contest. Each fund sells a different amount of upside for a different amount of income, and the right choice is the one that matches your own trade. QQQI is a well-priced entry on that menu. The work is in deciding what you are trading for, and the prospectus, not the yield, is where that answer lives.

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