YMAX vs YMAG: The Whole YieldMax Book, or Just Mag 7?

Overview

YMAG and YMAX are both YieldMax-issued option income ETFs structured as funds of funds, generating weekly distributions by layering covered call strategies across multiple underlying securities. YMAG focuses exclusively on the Magnificent 7 tech stocks (Apple, Microsoft, Nvidia, Tesla, Google, Amazon, Meta), while YMAX invests across a broader basket of YieldMax single-stock option income ETFs, giving it exposure to dozens of companies beyond mega-cap tech.

How they differ

The biggest difference is scope: YMAG holds seven stocks; YMAX spreads capital across a much wider universe of YieldMax option ETFs, diluting concentration in any single name. That diversification shows up in beta—YMAX's 1.5515 versus YMAG's 1.1624—meaning YMAX amplifies market moves more than YMAG does, likely because it captures volatility from smaller and mid-cap holdings outside the Magnificent 7. On yield, YMAX distributes 40.78% compared to YMAG's 36.08%, a 4.7% percentage-point gap that may reflect the broader ETF universe capturing call premium from less liquid, higher-volatility securities. Expense ratios are nearly identical—1.34% for YMAG and 1.33% for YMAX—but YMAX holds a larger asset base at $371M versus $295M.

Who each is best for

• YMAG: Investors who want concentrated exposure to the Magnificent 7's call premium generation and are comfortable holding a narrow basket of mega-cap tech stocks in exchange for lower market sensitivity than YMAX.

• YMAX: Investors seeking a broader equity option strategy that trades concentration risk for exposure to dozens of underlying YieldMax single-stock option income ETFs and are willing to accept higher market beta.

Key risks to know

• NAV erosion at extreme yields. Both funds distribute yields above 36%, well into the zone where return-of-capital treatment and balance-sheet shrinkage become likely. Over multi-year holding periods, compounding distributions at these levels without corresponding asset appreciation typically erodes principal.

• Derivative complexity and liquidity cascade. Both are funds of funds holding other option income ETFs, which themselves hold covered call positions. This layering means losses or redemptions in underlying YieldMax ETFs can propagate upward, and the bid-ask spreads on underlying holdings may be wider than the funds themselves report.

• Concentration in call premium decay. Both funds' income depends on continuous rolling of short calls against their holdings. If implied volatility compresses or equity prices rally sharply, call premium shrinks and distributions fall—a structural headwind unrelated to the funds' own management.

• YMAX's higher beta sensitivity. YMAX's 1.5515 indicates roughly 55% more downside participation than the broad market in equity sell-offs, a meaningful risk if option premium collection doesn't offset equity losses in a sharp correction.

• Fund-of-funds fee layering. Holding multiple YieldMax option ETFs within the fund creates an additional layer of expense; although the headline ratios are low, the true all-in cost includes the expense ratios of the underlying option income ETFs themselves, which is not visible in YMAG and YMAX's stated ratios.

Bottom line

If you want narrower exposure focused on tech mega-caps and lower market participation, YMAG's Magnificent 7 concentration and lower beta may appeal; if you prefer the diversification of a broader YieldMax ETF universe despite higher volatility, YMAX offers it. Both funds distribute at yields so high that principal erosion is a primary risk to model, and both compound that risk through derivative layering and fees that extend beyond their stated expense ratios. Past performance does not predict future results.