DIVO Trails SPY by 3.77 Points as 0.56% Fees and Covered Calls Weigh
Updated
Updated · 24/7 Wall St. · Jul 17
DIVO Trails SPY by 3.77 Points as 0.56% Fees and Covered Calls Weigh
1 articles · Updated · 24/7 Wall St. · Jul 17
Summary
6.94% year-to-date through July 10 left DIVO behind SPY’s 10.71%, extending underperformance to one, five and 10 years as the fund’s covered-call overlay caps upside in strong markets.
0.56% annual fees also widen the drag: a $10,000 investment costs about $56 a year versus roughly $6 for SCHD, a gap that compounds to about $4,000 over 20 years at an 8% pre-fee return.
December 2025 exposed another cost, with a $0.95339676 special distribution far above DIVO’s roughly $0.18 monthly payouts in 2026, creating a potentially messy year-end tax event for taxable accounts.
20 to 25 stocks in the portfolio add concentration risk, while cheaper dividend ETFs such as SCHD and DGRO offer broader diversification and uncapped upside for investors who do not need enhanced monthly income.