As 2025 wraps up, investors are reassessing portfolios for tax-loss harvesting opportunities, and covered call ETFs present unique advantages in this process. Because these ETFs can distribute more income than their total return, they may show negative price returns, even when overall performance is positive, creating tax-loss opportunities. 

Investors holding traditional monthly covered call ETFs can use harvested losses to upgrade into daily covered call strategies that aim to capture more upside while maintaining high income. Monthly covered call funds often miss market gains once underlying stocks exceed strike prices early in the month, leaving many investors disappointed during strong rallies. 

Daily covered call ETFs, such as the ProShares S&P 500 High Income ETF (ISPY), seek to improve the balance between income and return by resetting options each day. 

Finsum: Daily covered call strategies are increasingly compelling for investors looking to reduce taxes and enhance performance.