Key Points
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The YieldMax AAPL Option Income Strategy ETF (APLY) provides indirect exposure to Apple (AAPL) stock, but with limitations.
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While the APLY ETF advertises a very high annual yield, there’s no assurance that it will actually outperform Apple stock.
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Plenty of people own Apple (NASDAQ:AAPL) stock because it’s a highly established, world-famous technology company and the stock goes up most years. Furthermore, holding Apple shares will get you a forward annual dividend yield of 0.49%.
Imagine, however, if you could indirectly invest in Apple stock and get a massive annual yield — not a traditional dividend, but a different kind of yield. This is possible in 2025 with the YieldMax AAPL Option Income Strategy ETF (NYSEARCA:APLY).
YieldMax is known for introducing unique exchange traded funds (ETFs) with eye-catching yields. The AAPL Option Income Strategy ETF may capture the attention of Apple stock bulls and income seekers, but you’d better learn the risks involved before considering a share position.
No Direct Ownership of Apple Stock
To start off, I must give credit to YieldMax for being honest. The company comes right out and admits that the AAPL Option Income Strategy ETF “does not invest directly in AAPL” stock.
Furthermore, YieldMax discloses that investors of the AAPL Option Income Strategy ETF won’t get any of the dividends paid by Apple. That’s not a big loss, though, since the APLY ETF’s annual yield is much greater than the 0.49% dividend yield that Apple pays.
Also, if you hold the YieldMax AAPL Option Income Strategy ETF then you’ll have to pay annualized fund operating expenses of 1.06%. Again, however, this is negligible when compared to the gigantic annual yield that APLY advertises.
So, I’ll just get to the crux of the matter. YieldMax claims that its AAPL Option Income Strategy ETF will pay a “distribution rate” (i.e., an annual yield) of 62.66%. That’s mind-blowing, and you might wonder how it’s possible.
A Complex Trading Strategy
For one thing, the YieldMax AAPL Option Income Strategy ETF holds large quantities of U.S. Treasury bonds. Since government bonds offer good yields in 2025 and are reliable sources of income, this accounts for some of APLY’s expected yield.
The secret sauce here, however, is the options trading strategies that YieldMax AAPL Option Income Strategy ETF deploys. Instead of holding Apple stock shares, the APLY ETF buys Apple call options and sells Apple put options; this is what YieldMax refers to as “synthetic long exposure.”
Then, YieldMax sells covered calls in order to gain income. These calls aren’t covered by Apple stock shares, but instead by the aforementioned synthetic Apple options buy-sell pairs.
That’s how YieldMax is able to pay out cash distributions each month. Through YieldMax’s complex bonds-and-options trading strategy, the AAPL Option Income Strategy ETF might actually yield 62.66% under the right conditions.
It’s Not Guaranteed Money
While the YieldMax AAPL Option Income Strategy ETF’s advertised yield is huge, there are risks and drawbacks involved. Notably, the fund uses covered calls and this options strategy limits or “caps” the gains when Apple stock goes up.
Thus, AAPL stock could rise sharply but the YieldMax AAPL Option Income Strategy ETF might only capture a small fraction of Apple stock’s gains. That’s a typical trade-off with covered call strategies: good income opportunities but capped upside when the underlying stock goes up a lot.
Apple stock has a long track record of rising most years, and some years it zooms to the moon. During those high-flying years for AAPL stock, the price gains of the YieldMax AAPL Option Income Strategy ETF may be disappointing.
Then, there’s the risk that the APLY ETF could fall sharply when the Apple stock price falls. If AAPL stock is volatile for a while, owners of the YieldMax AAPL Option Income Strategy ETF could be exposed to a severe share-price crash.
A share-price collapse could negatively offset the YieldMax AAPL Option Income Strategy ETF’s 62.66% yield. Consequently, it’s possible that APLY could underperform Apple stock.
APLY ETF: Mind the Risks, Please
On top of all that, there’s the risk that the YieldMax AAPL Option Income Strategy ETF’s annual yield may get reduced at some point. Again, share-price volatility in Apple stock might create issues for APLY and the fund’s annual yield can’t be guaranteed for the future.
This doesn’t mean you can’t buy YieldMax AAPL Option Income Strategy ETF. It could be fine to purchase a small number of APLY shares as long as you understand the risks and potential issues. Alternatively, if you don’t want to deal with the possible downsides of the YieldMax fund, you can choose the safer path and just buy Apple stock shares.
The post Discover the Apple ETF Strategy (APLY) Paying Out an Ultra-High Yield 62.66% Right Now appeared first on 24/7 Wall St..
