Bond BuyWrite Strategy ETFs Can Stabilize Income

BuyWrite funds may provide enhanced income by selling monthly covered call options. BuyWrite funds could outperform in periods of rising interest rates and widening credit spreads. iShares 20+ Year Treasury Bond BuyWrite Strategy ETF (TLTW), iShares Investment Grade Corporate Bond BuyWrite Strategy ETF (LQDW), and iShares High Yield Corporate Bond BuyWrite Strategy ETF (HYGW) are the Bond BuyWrite Strategy ETFs. A BuyWrite (covered call) investment strategy is when an investor buys a security and simultaneously writes (sells) a call option on that security. The purpose of the strategy is to generate additional income from the sale of the call option, known as the option premium. Steve Laipply weighs in on enhancing and stabilizing income in certain market conditions.