There are seven Nasdaq 100 covered call ETFs worth your time right now. One of them just delivered 28% in a single year. One is paying a 17% yield with Section 1256 tax treatment, and most people have never heard of it. And the fund that most income investors default to first? It came in dead last.

I ranked all seven across five criteria: yield, tax efficiency, NAV preservation, total return potential, and strategy sophistication. Every fund gets a score out of 25. There is a clear winner, and I'll give you my honest take on each one, including the fund that outscored a five-star Morningstar ETF despite only launching in September.

Let's get into it.

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There are seven Nasdaq 100 covered call ETFs worth your time right now. One of them just delivered 28% in a single year. One is paying a 17% yield with Section 1256 tax treatment, and most people have never heard of it. And the fund that most income investors default to first? It came in dead last.

I ranked all seven across five criteria: yield, tax efficiency, NAV preservation, total return potential, and strategy sophistication. Every fund gets a score out of 25. There is a clear winner, and I'll give you my honest take on each one, including the fund that outscored a five-star Morningstar ETF despite only launching in September.

Let's get into it.

The Five Criteria

Five categories, each scored out of five. Maximum possible is 25.

1. Yield — The actual current distribution rate. Higher scores better — but this is one data point, not the whole story.

2. Tax Efficiency — Funds using Section 1256 index options get a 60/40 long-term/short-term split. The gap versus ordinary income is enormous in a taxable account.

3. NAV Preservation — Is this fund holding its share price over time, or slowly bleeding out your principal? A 15% yield on a fund losing 10% per year in NAV is not 15% income.

4. Total Return — Yield plus price return. How much upside in the Nasdaq does this fund actually capture? Verified one-year total return figures throughout.

5. Strategy Sophistication — Is the options overlay engineered for better outcomes, active management, partial coverage, Section 1256, 0DTE, or is it a blunt mechanical process?

Starting at the bottom. Let's go.

#7 — QYLD | The Original Yield Trap | Score: 8/25

Yield: ~11–12% | 1-Yr Return: 14.04% | Coverage: 100% ATM | Tax: Ordinary Income

QYLD has been around since 2013 and it was the fund that introduced most retail investors to covered call ETFs. The strategy: hold every stock in the Nasdaq 100, sell at-the-money monthly calls on 100% of the portfolio. Selling at-the-money means you capture maximum premium — but every single month you've completely surrendered any upside participation in the Nasdaq. Every rally. Every breakout. Capped. Every month without exception.

The numbers tell the story. A one-year total return of 14.04% compared to GPIQ's 28.06%, QQQI's 25.28%, or even QYLG's 24.44%. QYLD is collecting income with one hand and destroying NAV with the other. In a sustained Nasdaq bull market, the premium income simply cannot keep up with the upside you're missing.

Ordinary income distributions. No Section 1256 treatment. No return-of-capital buffer. The least tax-efficient structure on this list.

QYLD is the cautionary tale. It taught a generation of income investors what happens when you optimize for yield and ignore everything else.

#6 — IQQQ | Daily Options Innovation, But Outgunned on Yield and Tax | Score: 16/25

Yield: 10.36% | 1-Yr Return: 25.36% | Coverage: Full Daily | Tax: Swap-Based

IQQQ from ProShares tracks the Nasdaq-100 Daily Covered Call Index using daily options through swap agreements. Instead of writing one monthly call and living with the result, the daily structure means premiums are collected every single trading session, smoothing out the income stream and reducing the impact of any single expiry.

The one-year total return of 25.36% is actually the highest among the fully established funds on this list. That's a real data point in IQQQ's favor and it shouldn't be dismissed.

Two things keep it at six. First, the 10.36% yield, while respectable, is significantly below QYLG's 17.31%, TDAQ's 17.37%, and QQQI's roughly 14%. Second, the swap-based structure does not qualify for Section 1256 tax treatment. Every dollar IQQQ distributes is ordinary income. That's a structural disadvantage that compounds every year.

Strong total return, interesting daily structure, decent NAV. The yield gap and ordinary income treatment are what keep it at six.

#5 — QYLG | A 17% Yield That Most People Are Sleeping On | Score: 16/25

Yield: 17.31% | 1-Yr Return: 24.44% | Coverage: 50% ATM | Tax: Ordinary Income

QYLG is Global X's direct answer to QYLD's biggest flaw. Same buy-write structure, same monthly ATM calls, but instead of covering 100% of the portfolio, it only covers 50%. The other half holds Nasdaq 100 stocks outright and participates in market upside with no cap. A deliberate 50/50 split between income generation and growth participation.

Most comparisons of QYLG quote a much lower yield because they're looking at older data. The current distribution rate is 17.31%, which puts QYLG at the very top of this list for raw yield. Paired with a one-year total return of 24.44% and meaningfully better NAV preservation than QYLD, this is a genuinely stronger fund than its reputation suggests.

The problem that doesn't go away: ordinary income distributions. No Section 1256 treatment, no return-of-capital component. At 17.31% yield, that tax drag is substantial in a taxable account. If you're in a tax-sheltered account like a Roth IRA or superannuation fund, this changes the conversation significantly.

A 17.31% yield and solid NAV preservation make QYLG a serious fund — especially in a sheltered account. Ordinary income treatment is the ceiling on where it can rank.

#4 — JEPQ | The Battle-Tested Standard — Ranked Honestly | Score: 18/25

Yield: 10.84% | 1-Yr Return: 23.95% | 3-Yr Annualized: 24%+ | Morningstar: 5-Star

JEPQ is JPMorgan's Nasdaq-focused income ETF. It actively manages a portfolio closely mirroring the Nasdaq 100, then overlays an out-of-the-money covered call strategy using equity-linked notes (ELNs). The multi-year track record shows that active management is genuinely working: over 24% annualized over three years, a five-star Morningstar rating, and a one-year return of 23.95%. If you own JEPQ, you're holding an excellent fund.

Note: If you hold JEPQ inside a tax-sheltered account, a Roth IRA, superannuation fund, or any structure where distributions aren't immediately taxed, the tax argument disappears entirely. In that scenario, JEPQ's three-year track record is the strongest argument on this list and it would rank higher.

Why it sits at four: the ELN structure generates ordinary income distributions. No Section 1256 treatment, no return-of-capital component. That tax drag is a real and recurring cost in a taxable account, and it compounds annually. On a pure fundamentals scorecard, both TDAQ and GPIQ rank above it.

#3 — TDAQ | Outscores a Five-Star Fund — Here's Why I'm Comfortable With That | Score: 20/25

Yield: 17.37% | Since Inception: 6.16%* | Strategy: 0DTE Daily | Tax: Section 1256

TDAQ from TappAlpha uses zero-days-to-expiration options on the Nasdaq 100, options that expire the same day they're written. Premium is captured, the position closes by end of day, and the process repeats the next morning. No overnight options exposure, no multi-week theta decay. Tight, disciplined daily premium collection on one of the most actively traded indexes in the world.

TDAQ uses Section 1256 contracts, meaning 60% of gains are treated as long-term capital gains and 40% as short-term, regardless of holding period. For a 0DTE options strategy where every position opens and closes in a single session, getting Section 1256 treatment is a meaningful structural achievement that most comparable funds don't have.

The yield of 17.37%, per TappAlpha's own data, is the highest distribution rate on this list, essentially tied with QYLG. Unlike QYLG, TDAQ's distributions carry Section 1256 tax treatment.

The honest limitation: TDAQ launched in September 2024. The since-inception return of 6.16% is roughly six months of live data in a choppy market. We haven't seen TDAQ navigate a full Nasdaq bull run or a real drawdown. That's the only reason it sits at three.

I want to be direct about why TDAQ ranks above JEPQ despite having a fraction of JEPQ's history. Section 1256 tax treatment, a higher yield, more consistent distributions, and a genuinely innovative 0DTE structure add up to a better scorecard. If you want the safest, most proven fund, JEPQ is your answer. If you want the best current combination of yield and tax efficiency and you're comfortable being an early adopter, TDAQ is worth serious attention.

Highest yield, Section 1256 structure, innovative 0DTE strategy. Time is the only thing missing. Check back in twelve months.

#2 — GPIQ | 28% in One Year — The Fundamentals Win | Score: 21/25

Yield: 10.37% | 1-Yr Return: 28.06% | Strategy: OTM Active Partial | Launched: June 2023

Goldman Sachs isn't a name you typically associate with retail income ETFs, but GPIQ is a sophisticated and carefully constructed product. The fund actively manages a Nasdaq-100-oriented equity portfolio — not a passive index wrapper — and overlays an out-of-the-money call writing strategy with partial coverage. Goldman's team actively decides how much of the portfolio to cover, which strike prices to use, and when to adjust based on market conditions. In a strong bull run, they reduce coverage and let more upside through. In a choppy market, they lean into premium collection.

The number that leads the conversation: a one-year total return of 28.06%, the highest verified one-year return on this entire list, four percentage points above IQQQ's 25.36% and nearly five above QQQI's 25.28%.

Why GPIQ over JEPQ, three reasons: First, total return: 28.06% versus 23.95% is a meaningful gap, not a rounding error. Second, GPIQ's expense ratio is lower than JEPQ's, which compounds in your favor over time. Third, GPIQ's active management produces a more tax-aware distribution profile than JEPQ's ELN structure.

The only limitation: GPIQ launched in June 2023. JEPQ has navigated a bear market phase — GPIQ hasn't. That track record gap is real, and it's why GPIQ sits at two rather than one.

Best one-year return on this list. Better fee structure than JEPQ. Institutional-grade active management. GPIQ earns #2 on the fundamentals.

#1 — QQQI | The Most Complete Package on This List | Score: 23/25

Yield: ~14% | 1-Yr Return: 25.28% | Tax: Section 1256 + ROC | Launched: Jan 2024

QQQI from NEOS holds the individual stocks of the Nasdaq 100 — not an index fund wrapper, the actual constituent equities. That matters because it opens the door to tax-loss harvesting at the position level, an unusual and valuable advantage in this space. The options overlay uses NDX index options, which are Section 1256 contracts under the US tax code.

Section 1256 treatment means 60% of gains are taxed at long-term capital gains rates and 40% at short-term, regardless of how long you've held the fund. But NEOS takes it further. A meaningful portion of QQQI's distributions are classified as return of capital. ROC isn't a red flag here, it's a deliberate structural feature that defers your tax liability by reducing your cost basis rather than triggering immediate income tax. For taxable account investors and international investors especially, this is one of the most investor-friendly distribution structures in the covered call ETF space.

Approximately 14% distribution rate, meaningfully higher than GPIQ's 10.37% or JEPQ's 10.84%, with better tax treatment than both. One-year total return of 25.28% puts QQQI comfortably in the top tier. Since launching in January 2024, QQQI has delivered nearly 20% annualized, outperforming the CBOE Nasdaq-100 BuyWrite Monthly Index by a wide margin.

GPIQ wins on total return. TDAQ wins on raw yield. QQQI wins on the combination of everything — and that combination is the hardest thing to replicate.

This is the one I own. That's not financial advice, it's context for why I put it at number one.

The best combination of yield, tax efficiency, and strategy engineering on this list. Not the highest total return — but the most complete package.

The Full Leaderboard

#1 — QQQI | 23/25 | ~14% yield | 25.28% 1-yr return | Most complete package

#2 — GPIQ | 21/25 | 10.37% yield | 28.06% 1-yr return | Best one-year total return

#3 — TDAQ | 20/25 | 17.37% yield | 6.16%* since inception | Highest yield + Section 1256

#4 — JEPQ | 18/25 | 10.84% yield | 23.95% 1-yr return | Best track record

#5 — QYLG | 16/25 | 17.31% yield | 24.44% 1-yr return | High yield, tax drag is the cost

#6 — IQQQ | 16/25 | 10.36% yield | 25.36% 1-yr return | Strong return, lower yield

#7 — QYLD | 8/25 | ~11–12% yield | 14.04% 1-yr return | The yield trap — avoid

TDAQ since-inception only (~6 months of data, launched Sept 2024)

A Few Things to Address Before the Comments Come In

On TDAQ at #3 above JEPQ: when you run the five criteria and weight tax structure seriously, TDAQ scores higher. The caveat is track record. If you want the most proven fund, JEPQ is your answer. TDAQ is for investors comfortable with a shorter history in exchange for a better-engineered structure.

On QYLG and IQQQ being tied at 16/25: QYLG ranks higher because the yield difference , 17.31% versus 10.36%, is too large to ignore when the total return figures are close. In a tax-sheltered account, QYLG climbs even further.

If you're in a Roth IRA, superannuation, or any tax-sheltered structure: the tax efficiency scores matter much less. In that scenario, JEPQ's track record becomes the strongest argument on this list and would rank second or possibly first.

Yield is the starting point, not the destination. Tax structure, NAV preservation, and total return potential are what separate a covered call ETF that builds your wealth from one that quietly erodes it while you're distracted by the income.

Drop a comment below — especially on TDAQ at #3. I read every single one and want to know where the community lands.

Disclaimer: This content is for informational and educational purposes only and does not constitute financial advice. All data referenced reflects figures available at the time of research. Past performance is not indicative of future results. Always verify current yields and returns directly on each fund's issuer page before making any investment decision. Steve Cummings is not a licensed financial advisor.