DIVO: Increased Volatility Levels Create More Risk Than Opportunity For This Fund
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The economic slowdown is increasing market volatility, impacting investment strategies. Covered-call funds like DIVO, which sells out-of-the-money call options on 20% of its holdings, aim to generate 2-4% income. However, increased volatility may pose more risk than opportunity for DIVO.
March 09, 2025 | 2:00 pm
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DIVO, a covered-call ETF, is facing increased market volatility due to the economic slowdown. While it aims to generate 2-4% income by selling out-of-the-money call options on 20% of its holdings, the heightened volatility may pose more risk than opportunity.
DIVO is directly impacted by the current economic slowdown and increased market volatility. As a covered-call ETF, it benefits from volatility but the current levels may introduce more risk than opportunity, potentially affecting its income generation strategy.
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