At a glance
MSFO charges 1.03% a year. It has $113.7M in assets; it paid 37.45% of its price in distributions over the past 12 months, monthly. Over the past year it returned +1.8% with distributions reinvested; over three years it returned +16.2% a year.
The short version
YieldMax MSFT Option Income Strategy ETF (MSFO) is an actively managed fund that uses options to mirror Microsoft's share price while selling call options for income. It keeps most of its assets in short-term US Treasury bills. Its trailing 12-month yield was 37.45% as of October 27, 2026. However, gains above the call strikes are given up, some payouts may be return of capital, and the fund charges 1.03% a year.
Price history
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MSFO +1.8% over the year to Oct 27, 2026, total return with distributions reinvested.
How it has behaved
| YTD | 1 yr | 3 yr | 5 yr | 10 yr | Since start | |
|---|---|---|---|---|---|---|
| MSFO official prospectus, to Dec 31, 2025 | — | +15.05% | — | — | — | +19.51% |
| MSFO price data to Oct 27, 2026 | +9.3% | +1.8% | +16.2% | — | — | +17.0% |
- Over the year to Oct 27, 2026, MSFO returned +1.8%.
- Its worst full calendar year was 2024 (+10.2%); its best was 2025 (+15.6%).
- The deepest fall in its price history was 29.5% (Oct 28, 2025 to Jun 25, 2026), recovered by Oct 6, 2026.
Show as a table
| Year | Price data | Prospectus (official) |
|---|---|---|
| 2026 (to date) | +9.3% | — |
| 2025 | +15.6% | +15.05% |
| 2024 | +10.2% | +11.16% |
| 2008 financial crisis stocks fell Oct 9, 2007 – Mar 9, 2009 | Before this security existed |
|---|---|
| 2020 COVID crash stocks fell Feb 19, 2020 – Mar 23, 2020 | Before this security existed |
| 2022 bear market stocks fell Jan 3, 2022 – Oct 12, 2022 | Before this security existed |
Dividends and income
Show as a table
| Year | Per share | Change |
|---|---|---|
| 2026 (to date) | $3.7200 | |
| 2025 | $5.2400 | -17.9% |
| 2024 | $6.3800 |
What's inside
As of Jul 31, 2026, the fund held 6 securities; the ten largest made up 86.18% of assets, and 2.13% sat in cash and money-market holdings.
| Holding | Weight | |
|---|---|---|
| TREASURY BILL Bonds and notes | 26.27% | |
| TREASURY BILL Bonds and notes | 21.52% | |
| TREASURY BILL Bonds and notes | 16.04% | |
| TREASURY BILL Bonds and notes | 12.50% | |
| TREASURY BILL Bonds and notes | 10.26% | |
| Microsoft Corp | -0.41% |
By country
United States 86.18%By issuer
US Treasury 86.58%Companies -0.41%The bonds mature in 0.2 years on average (weighted by size), with an average coupon of 0%.
Source: N-PORT holdings report as of Jul 31, 2026. Cash, money-market funds and derivatives are shown separately from the securities list.What changed recently
- Over the three months to Jul 31, 2026, investors added a net $13.7M (creations minus redemptions, per the N-PORT report).
- Monthly total returns reported for that quarter: +7.65%, -15.29%, +19.94%.
How it works
MSFO does not track an index. Its prospectus, filed February 24, 2026, states the goal as current income. Instead of buying Microsoft (MSFT) shares, the fund mainly runs a "synthetic covered call." It buys and sells call and put options on Microsoft to mimic 100% of the stock's price moves. A call gives the right to buy shares at a set "strike" price, and a put gives the right to sell. The fund uses both standard listed options and FLEX options, which trade on an exchange but allow custom terms.
On top of that position, the fund sells Microsoft call options and collects the premium, which is the price a buyer pays for an option. If Microsoft rises above the strike, the fund gives up those extra gains. In a "call spread" version, it also buys a higher-strike call, which lets some gains through. Losses in Microsoft pass through in full, softened only by premiums. The fund keeps this approach in every market and does not take defensive positions.
As of July 31, 2026, about 86.6% of its $113.7 million in net assets sat in five Treasury bills averaging about 0.2 years to maturity. The rest was 15 Microsoft option positions and a slightly negative (-0.41%) direct stock position. Holders get no Microsoft dividends unless the fund owns the shares. The fund seeks to pay weekly, but amounts vary and may include return of capital.
What it really costs
- MSFO charges 1.03% a year.
- Of that, 0.99% is the management fee; the rest covers other fund expenses.
- Using the prospectus's standard example, $10,000 invested would cost about $105 in the first year and $1,259 over 10 years (assuming a 5% annual return).
| Cost of $10,000 (SEC example) | 1 yr | 3 yrs | 5 yrs | 10 yrs |
|---|---|---|---|---|
| MSFO | $105 | $328 | $569 | $1,259 |
Structure and tax notes
- Generates much of its income from selling options (directly or through notes). That income is usually taxed as ordinary income rather than as qualified dividends, and the strategy gives up some upside in strong markets.
- Bond prices move opposite to interest rates; the longer the maturities it holds, the more its price reacts to rate changes.
In a retirement portfolio
It concentrates on a single stock through options, it fell as much as 29.5% from peak to trough, and its large payouts may partly be return of capital.
MSFO launched on August 25, 2023, so it has no record through the 2008, 2020 or 2022 downturns. Both of its full calendar years, 2024 and 2025, were gains. Its deepest drop was 29.5%, from October 28, 2025 to June 25, 2026. It recovered by October 6, 2026, about 3.4 months later. Anyone who sold shares or drew income near that low would have locked in losses. Its trailing 12-month yield was 37.45% ($4.67 a share) as of October 27, 2026, and it aims to pay weekly. But amounts vary, and return of capital can wear down the share price. Option income is usually taxed as ordinary income. Costs are steep: in the SEC's standard example, the 1.03% expense ratio comes to about $105 in the first year on $10,000. Past results don't predict the future, and a plan should look at the whole portfolio, not one fund.
Who it may suit — and who should look elsewhere
May suit
- Investors who want large, frequent cash payouts tied to Microsoft and accept that weekly amounts vary and may partly be return of capital.
- Holders who expect Microsoft to trade flat or rise modestly, where selling calls adds premium without giving up much upside.
- Those holding a small position in a tax-advantaged account, where option income taxed as ordinary income is less of a drag.
Look elsewhere if
- Anyone who wants diversification: the fund's stock exposure rests on one company, Microsoft, alongside short-term Treasury bills.
- Cost-focused investors: in the SEC's standard example, the 1.03% expense ratio adds up to about $1,259 over 10 years on $10,000.
- Those who want Microsoft's full upside, its dividends, or a long track record. Gains are capped, and the fund launched in August 2023.
Close alternatives
Matched by bond funds with the closest average maturity and issuer mix (N-PORT).
No close alternatives found.
Questions investors ask
Is MSFO good for retirement income?
It can produce large payouts, but with real trade-offs. Its trailing 12-month yield was 37.45% as of October 27, 2026. Part of those distributions may be return of capital, which lowers the fund's value. The fund also takes on Microsoft's full downside. It fell 29.5% between October 2025 and June 2026. It may suit investors who treat it as a small, higher-risk slice rather than a core source of income.
Does MSFO pay weekly or monthly dividends?
Its prospectus says MSFO seeks to pay weekly cash distributions. It does not guarantee a payout in any given week, and amounts are likely to vary widely from one payment to the next. Distributions totaled $4.67 a share over the 12 months to October 27, 2026. Some payments may count as return of capital rather than income. Option income is usually taxed as ordinary income, not as qualified dividends.
Does MSFO own Microsoft stock?
Mostly not. As of July 31, 2026, about 86.6% of its assets sat in US Treasury bills. Its Microsoft exposure came through 15 option positions. Its direct Microsoft stock position was slightly negative, at -0.41%. Because it does not hold the shares in any meaningful amount, MSFO holders do not receive Microsoft's dividends. They also have no voting rights in the company.
What's the difference between MSFO and owning MSFT stock?
MSFO trades some of Microsoft's upside for option income. When Microsoft climbs above the strike of the calls the fund sold, MSFO misses those extra gains. When Microsoft falls, the fund takes the full loss, softened only by option premiums. Owning the stock gives full upside, dividends and voting rights, with no fund fee. MSFO charges 1.03% a year and pays large, variable distributions that are usually taxed as ordinary income.
How has MSFO performed since launch?
Results have been positive but uneven. Its prospectus reports returns of 11.16% in 2024 and 15.05% in 2025. Through December 31, 2025, it averaged 19.51% a year since inception. As of October 27, 2026, it had gained 1.8% over one year and averaged 16.2% a year over three years. Its strongest quarter rose 26.22% (to June 2025), and its weakest fell 8.31% (to March 2025).