Liquid Strategies Launches Nasdaq-100 Income ETF Targeting 12% Annual Distributions

Liquid Strategies has launched the Overlay Shares Nasdaq 100 Income ETF (OVQ), an actively managed fund combining Nasdaq-100 equity exposure with an options-based income strategy. The ETF invests at least 80% of its assets, directly or indirectly, in Nasdaq-100 constituents while employing short-term put credit spreads to generate additional income. The strategy involves selling put options and purchasing lower-strike puts to limit potential losses, with options typically expiring within one to two weeks. OVQ targets a 12% annual distribution rate, paid monthly, although payments are not guaranteed and may include return of capital. The fund also seeks tax efficiency through Section 1256 index options, which receive blended long-term and short-term capital gains treatment. The strategy aims to generate income across rising, flat and moderately declining markets, but remains exposed to substantial losses during sharp market downturns.