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QYLD vs XYLD vs RYLD: what does the index change?

QYLD, XYLD and RYLD all run one rule. Own an index. Sell one-month calls at about today's level. Pay out cash every month. The only real difference is the index. A jumpier index pays a bigger premium, and falls harder when it goes wrong.

Comparison · 8-minute read · Updated 2026-10-28

The short answer

These are three Global X covered call ETFs:

• XYLD sells calls on the S&P 500, 500 large US companies.
• QYLD sells calls on the Nasdaq-100, heavy in big tech.
• RYLD sells calls on the Russell 2000, 2,000 smaller US companies.

XYLD and QYLD hold their index's stocks. RYLD holds a Global X Russell 2000 ETF instead. Each sells one-month calls At the money, at or just above today's level. Each pays out cash every month, mostly from that premium.

The index decides how much the calls are worth. Calls on a jumpier index cost more, so the fund collects more. That same jumpiness means bigger drops. And at-the-money calls keep almost none of the climb back.

None of these funds is a recommendation to buy or sell. Designs are as of October 2026. Check each fund's current page on the Global X site.

Side by side

The rule is the same down every column. Only the engine changes.

Why the jumpier index pays more

An option's price rises with how much the market expects the index to move. That expectation is Implied volatility. Small companies swing more than big ones. Big tech swings more than the broad market.

So an at-the-money call on the Russell 2000 usually sells for more than one on the S&P 500. That's where RYLD's bigger payout comes from. It isn't extra skill. It's extra risk, sold for cash.

A drop and a recovery (hypothetical)

This is where the bigger payout turns against you. It's a simplified model with made-up round numbers, not any fund's real results. It's an illustration, not a trade idea. The calls cover the whole basket, and all premium is paid out.

Three people each put $10,000 in.

• XYLD-like: collects $150 a month at the money.
• QYLD-like: collects $200 a month.
• RYLD-like: collects $220 a month.

Month 1: the market drops. The S&P 500 falls 8%, the Nasdaq-100 falls 12%, the Russell 2000 falls 15%. The premium cushions a little.

Month 2: every index climbs all the way back to where it started. Each fund sells a new at-the-money call on its smaller basket, so the premium shrinks a bit. And the call hands the whole climb to the buyer.

Every index ended even. Every fund ended behind.

Look at what each person holds now:

• XYLD-like: shares worth $9,200, plus $288 paid out.
• QYLD-like: shares worth $8,800, plus $376 paid out.
• RYLD-like: shares worth $8,500, plus $407 paid out.

The RYLD-like fund paid the most. It also lost the most, −$1,093, because its index fell furthest and it kept none of the rebound. The payout was real money. The hole under it was bigger.

What happens when this repeats

Markets fall and recover again and again. Each time, an at-the-money fund keeps the fall and gives away the bounce. The share price steps down and doesn't step back up. That slow slide is NAV erosion.

The jumpier the index, the bigger each step. Our why QYLD's price keeps falling guide runs it month by month over six months.

How to compare the three honestly

1. Ignore the payout rate on its own. A bigger one mostly means a jumpier index. See distribution rate vs SEC yield.
2. Compare Total return, price plus payouts, against the plain index, over the same years.
3. Look at the worst year. How far did each fall, and did the price ever get back?
4. Check how much of the payout is Return of capital. That's partly your own money coming back.

Canadian readers: all three are US-listed. In a TFSA, US withholding can take part of each payout; see US covered call ETFs in a TFSA.

Doing it yourself, you aren't stuck at the money after a drop. You can sell further up, closer to where you bought, or not sell at all. That choice is the heart of the wheel strategy. The full map of fund designs is in how covered call ETFs work.

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