BetaShares to launch NASDAQ-100 managed fund

Oksana Patron

9 September 2022

BetaShares has announced the launch of its new managed fund, the NASDAQ 100 Yield Maximiser Fund (QMAX), expected to start trading in September, subject to approvals, which will provide exposure to the companies making up the NASDAQ-100 Index.

The new fund would aim to exceed the dividend yield associated with holding the portfolio of underlying shares alone, while not tracking the performance of any benchmark, the firm said.

According to BetaShares, QMAX would offer lower overall volatility than the underlying NASDAQ-100 Index while “selling some of the upside share price potential of the portfolio in return for additional upfront income via a ‘covered call’ or ‘buy-write’ strategy”.

The firm stressed that the income generated from the sale of call options could be attractive, as option premium rose with an increase in volatility, all else being equal.

“QMAX’s strategy aims to outperform a strategy of holding the share portfolio alone (i.e. without writing call options) in falling, flat and gradually rising markets,” BetaShares’ chief executive, Alex Vynokur, said.

“However, in a strongly rising market, covered call strategies such as QMAX should be expected to produce lower total returns compared to owning the share portfolio alone.”

The new fund would also join BetaShares’ existing suite of Yield Maximiser Funds, which included the Australian Top 20 Yield Maximiser Fund (YMAX), launched in 2012, and the S&P 500 Yield Maximiser Fund (UMAX), launched in 2014, with the collective funds under management (FUM) of these two managed funds standing currently at $480 million.