ULTY vs YMAX: Which Is the Better Pick in 2026?

Overview

ULTY and YMAX are both YieldMax-issued, weekly-distributing covered-call ETFs launched in early 2024. The critical difference: ULTY writes calls on a basket of high-volatility individual stocks, while YMAX is a fund-of-funds that holds YieldMax single-stock option-income ETFs. ULTY targets a 67.98% distribution rate; YMAX targets 50.99%. Both rely on options overlays to generate income above traditional equity yields.

How they differ

ULTY's strategy is direct: it holds high-volatility equities and systematically sells covered calls on them to generate its outsized yield. YMAX, by contrast, owns a basket of YieldMax's own single-stock covered-call ETFs—adding a layer of indirection and fees. That structural difference cascades into three measurable distinctions. First, ULTY's distribution rate of 67.98% is 17 percentage points higher than YMAX's 50.99%, reflecting either more aggressive call-writing or higher underlying volatility capture. Second, ULTY has $914M in AUM versus YMAX's $420M, suggesting investor preference for the simpler, higher-yield structure. Third, YMAX's beta of 1.5515 exceeds ULTY's 1.3581, indicating YMAX amplifies market moves more sharply—a byproduct of holding leveraged or more volatile component funds rather than individual stocks directly.

Who each is best for

ULTY: Fits investors seeking maximum current income from equity exposure and comfortable with weekly distributions at 68% annualized yield, who tolerate significant call-cap risk and prefer a straightforward, single-fund structure without embedded fund-of-funds costs.

YMAX: Fits investors who want diversified exposure to YieldMax's option-income ecosystem and are willing to accept a lower distribution rate and double-layer fee structure (1.28% at YMAX plus embedded fees in its held ETFs) in exchange for diversification across multiple single-stock strategies.

Key risks to know

• NAV erosion at extreme yields: Both funds distribute well above 50% annually, a level at which return-of-capital treatment becomes probable. When distributions exceed underlying capital appreciation and dividend income, NAV declines over time unless volatility or call-writing mechanics persistently replenish it. ULTY's 67.98% rate intensifies this risk.

• Call-cap and upside sacrifice: Covered-call strategies cap gains when underlying holdings rally sharply. ULTY's direct equity basket and YMAX's component ETFs will both see called-away shares during rallies, locking in capped returns and shifting realized gains to shareholders—a hidden tax cost in taxable accounts.

• Fund-of-funds embedded costs: YMAX holds YieldMax option-income ETFs, each with its own expense ratio. Combined with YMAX's 1.28% stated expense ratio, total all-in costs are materially higher than ULTY's 1.14%, eroding returns net of distributions.

• Beta amplification and volatility dependency: YMAX's beta of 1.5515 versus ULTY's 1.3581 signals higher systematic market sensitivity. Since covered-call income depends on realized volatility (higher volatility = wider call spreads = more premium), YMAX's elevated beta creates risk that market downturns simultaneously reduce equity values, reduce call premiums, and spike volatility in ways that disadvantage rebalancing.

• Limited track record: Both funds have operated less than one year. Neither has weathered a full market cycle or volatility regime change, so the sustainability of their stated yields under stressed conditions remains untested.

Bottom line

ULTY offers higher yield and simpler structure; YMAX trades that for diversified single-stock exposure and a funds-of-funds wrapper. If maximum current income and straightforward mechanics appeal to you, ULTY's higher distribution rate and lower fees stand out; if you value optionality across multiple YieldMax strategies over raw yield, YMAX's diversification may justify its cost. Neither fund's past distribution rates—given their January–February 2024 inception dates—predict future results, especially as volatility regimes or market conditions shift.