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NVDY or your own covered calls on Nvidia: what does each keep when it climbs?

NVDY runs a covered-call-style trade on Nvidia for you, starting at one fund share. Doing it yourself needs 100 shares, but you pick how far above the price your cap sits. On a stock known for long climbs, that one choice decides most of the result.

Comparison · 7-minute read · Updated 2026-10-28

The short answer

NVDY is a YieldMax fund built on Nvidia (NVDA). As of October 2026, it doesn't hold Nvidia shares. It copies the stock's moves with options, sells call spreads on top, and pays out most of the premium weekly. A spread keeps a little upside above its higher strike.

Selling covered calls on Nvidia yourself means owning 100 NVDA shares and selling one Call option against them, at a strike and date you pick.

Both take nearly the full drop. Both give up part of a rally. The difference shows up when Nvidia climbs week after week. The fund sells new short-dated calls again and again, so it caps again and again. You can set one cap, far above the price, for the whole month. This isn't a recommendation to buy or sell NVDY or Nvidia.

How these funds are built is in how YieldMax ETFs work. Fund methods change, so read NVDY's current page on the YieldMax site before you rely on any of this.

Side by side

What makes Nvidia different

Every single-stock fund page looks alike until you look at the stock. Three things stand out with Nvidia:

• It's huge and very actively traded. Its options have lots of buyers and sellers, so prices are easy to get and spreads tend to be tight.
• Earnings can move it hard. Like every US company, it reports four times a year. Those days can swing the stock a lot in one night.
• It has had long climbs. Weeks of steady gains in a row. That's the pattern a weekly cap handles worst.

Here's the cost of 100 shares at made-up prices. Check the real price today.

A steady climb, worked out (hypothetical)

This is an illustration, not a trade idea, and not NVDY's real trades. A made-up NVDA price starts at $150. Three people each have $15,000 at stake.

• The shareholder holds 100 shares.
• The do-it-yourself seller holds 100 shares and sells one 30-day $170 call for $3, collecting $300.
• The fund holder has $15,000 in a made-up fund that sells a new call $3 above the price every week, collecting $200 each time.

Nvidia climbs $8 a share every week for four weeks.

Nobody lost money. But look at what each one kept. The fund ended $1,200 behind the shareholder: each week it gave up $500 of the climb above its cap and got back $200 of premium. The do-it-yourself seller ended $900 behind: they gave up the $1,200 above $170, once, and kept $300 of premium.

Put the strike at $160 instead, and the do-it-yourself seller keeps only $1,000 + a bigger premium. Put it at $190, and they keep the whole climb but collect less. The cap is a choice. In the fund, the choice is made for you every week.

An earnings drop, worked out (hypothetical)

Same start, $150. This time Nvidia falls to $120 on earnings in week 2, then sits there. The made-up fund collects $400 that week, since calls cost more around earnings, and $200 in the other weeks.

Everyone loses. In a drop, the fund's four premiums cushion a bit more than one monthly call. But none of them comes close to the fall. Part of the fund holder's loss shows up as payouts they received and part as a lower share price. Over time that's NAV erosion.

The do-it-yourself seller had one more option here: close out before earnings, or not own the shares that week at all. That choice costs a premium. It can also skip a gap.

What you control, and what you don't

Doing it yourself, you decide:

• how far above the price your cap sits;
• the date, around or away from earnings;
• whether to sell at all after a big run or a big drop.

You don't control Nvidia. A 20% drop costs nearly the same either way. That's why the size of the position comes first, before any call. The same order runs through the wheel strategy. For how NVDY's design compares with index funds like JEPI, see how covered call ETFs work. For the same question on other stocks, see TSLY and MSTY.

Canadian readers: covered calls are widely allowed in a TFSA or RRSP, but options permissions differ by broker. A US-listed fund held in a TFSA can lose part of its payouts to US withholding tax; see US covered call ETFs in a TFSA.

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