REX COIN Covered Call ETF (COII) seeks to generate income through a covered call strategy on cryptocurrency-related holdings. This approach involves owning underlying crypto assets or crypto-related securities while simultaneously selling call options to collect premium income, creating a yield-focused crypto investment vehicle.
How It Works
COII employs an active covered call strategy, holding cryptocurrency positions while systematically selling call options against those holdings to generate premium income. The fund collects option premiums as income but caps upside potential when calls are exercised. Rebalancing occurs regularly to maintain optimal option coverage ratios and strike price selection. This income-focused approach transforms volatile crypto assets into a yield-generating investment, though specific holdings composition and crypto allocation methodology are not yet disclosed given the fund's recent inception.
Key Features
- High dividend yield of 6.86% generated through systematic call option premium collection on cryptocurrency holdings
- First-to-market covered call strategy specifically targeting cryptocurrency assets for income-focused crypto exposure
- Recently launched in June 2025 with no expense ratio currently disclosed, targeting yield-seeking crypto investors
Risks
- This ETF caps upside potential when crypto prices surge rapidly, as call options limit gains above strike prices during bull markets
- Cryptocurrency volatility can cause significant principal losses even with option income, potentially declining 50-80% during crypto bear markets
- Options strategy complexity and crypto market immaturity create execution risks that could reduce income generation or increase losses
Who Should Own This
Best suited for income-focused investors with high risk tolerance seeking cryptocurrency exposure through a yield strategy. Appropriate as a satellite holding (5-10% allocation) for portfolios wanting crypto income generation. Requires 1-3 year time horizon to weather crypto volatility while collecting option premiums, ideal for investors comfortable with capped upside in exchange for regular income.