CONY vs TSLY: Which Is the Better Pick in 2026?

Overview

CONY and TSLY are both single-stock covered-call ETFs from YieldMax that generate income by selling out-of-the-money call options on their underlying holdings—Coinbase and Tesla, respectively. They're structurally identical (same issuer, weekly distributions, similar expense ratios around 1.05%), but they differ sharply in their underlying asset's volatility, the yield they're targeting, and the sustainability of those distributions.

How they differ

The biggest difference is yield ambition and underlying volatility. CONY targets a 70.6% annualized distribution rate on a crypto asset (Coinbase) with a beta of 0.0 and a 52-week range from $23.43 to $107—extreme price swings that create friction for a covered-call strategy. TSLY targets 44.8% on Tesla, a much larger and more liquid equity with a beta of 1.69 and a tighter 52-week range ($27.16 to $49.65). That yield gap matters: CONY's weekly dividend of $0.38 on a $27.99 NAV is nearly 50% annualized just from the last payment alone, while TSLY's $0.26 on $30.29 is closer to 28% annualized. TSLY has triple the assets under management ($862.7M vs. $393.3M), suggesting more confidence in its sustainability and lower closure risk. Both carry 1% expense ratios, but CONY's cost is harder to justify given the higher distribution rate, which leaves less margin for the fund to recover from call-writing losses or principal decline.

Who each is best for

CONY: Investors with very high risk tolerance and a 1–2 year time horizon who understand crypto volatility and are willing to sacrifice upside potential (and possibly principal) for weekly cash flow; best held in taxable accounts where weekly distributions don't trigger rebalancing costs in retirement accounts.

TSLY: Income-focused investors seeking high yield without crypto exposure, with moderate-to-high risk tolerance and a 2–3 year horizon; also suitable for taxable accounts, though the lower distribution rate and larger AUM suggest less near-term closure risk.

Key risks to know

• NAV erosion. CONY's 70.6% distribution rate implies that roughly 70% of the fund's value is paid out annually, requiring constant capital appreciation from COIN or return-of-capital treatment to sustain. A prolonged decline in Coinbase stock could force the fund to pay distributions from principal.

• Covered-call cap. Both funds cap upside by selling calls; if COIN or TSLA rallies sharply, shareholders miss gains beyond the strike price. For a growth stock like COIN, this is a material structural drag.

• Concentration and single-asset risk. Holding only Coinbase or Tesla means you're not diversified; if your underlying holding faces regulatory action, earnings miss, or sector headwind, the fund has no buffer.

• Volatility mismatch. CONY's beta of 0.0 despite COIN's wild price swings suggests pricing or calculation lag; options pricing may not keep pace with real volatility, leaving the fund exposed to realized-versus-implied volatility gaps.

• Expense ratio drag at high yields. The 1.04–1.07% fee is substantial relative to TSLY's 44.8% yield, and especially steep for CONY's 70.6% target, compressing the net return investors actually keep.

Bottom line

If you need maximum current income and can tolerate crypto volatility and near-certain principal erosion over 2+ years, CONY's 70% yield is unmatched. If you want high yield with lower NAV-erosion risk and a more established underlying, TSLY's 45% yield and triple the AUM suggest a more durable product. Neither is a buy-and-hold; both require active monitoring of NAV and call-strike prices. Past distributions don't predict future results, and both funds' NAVs may decline materially if their underlying stocks fall.