Consider the Invesco QQQ Income Advantage ETF for Volatility Mitigation

The Invesco QQQ Income Advantage ETF (QQA ) is designed to provide investors with exposure to the Nasdaq-100, but also utilizes an active option income overlay to provide income, downside protection, as well as upside participation.

Investors have had a healthy appetite for income-generating investments in recent years, as investment income can help offset market volatility. QQA’s 30-day SEC yield is 11.1% as of April 9.

Additionally, the downside protection offered in QQA may help investors maintain target equity exposure during choppy markets.

Since the Invesco QQQ Income Advantage ETF’s inception last July, it is outperforming the popular Invesco QQQ ETF (QQQ B+). As the Nasdaq-100 has struggled in 2025 to date, QQA has helped mitigate some losses for investors.

The strategy underpinning QQA has two components to it, which helps set it apart from category peers. The first part is a passive equity sleeve; the second is an active options income overlay, which includes both calls and puts. 

The strategy effectively provides investors exposure to passive equity in an index that they’re familiar with, while also providing an active option overlay to provide that consistent income stream.

Notably, a common pitfall with option income strategies is that if the VIX spikes, yields go up. Therefore, when markets calm down again and volatility falls, the yield falls as well. To solve for this, the Invesco funds aim to offer a similar yield profile across market volatility regimes. 

The portfolios are conservatively built to aid in downside risk mitigation. The funds use no leverage and are always fully covered, fully collateralized, and structurally defensive. This may reduce market volatility by 20 to 30%, making it a defensive way to add monthly income.

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