Two of the market's most popular income ETFs compared side-by-side. See which one fits your yield strategy.
What this means: Both WDTE and XDTE fall intoTier 5: Octane. This suggests they share a similar risk profile and volatility expectation.
| Metric | WDTE | XDTE |
|---|---|---|
| Total Return (1Y) | 14.16% | 22.53% |
| NAV Change (1Y) | -16.73% | -17.95% |
| Max Drawdown | 0.00% | 0.00% |
| Beta | - | - |
* Returns include dividend reinvestment. Drawdown calculates peak-to-trough decline over trailing 12 months.
WDTE (Defiance S&P 500 Target Income) is a high-risk synthetic income fund managed by Defiance. It focuses on generating income through strategic holdings. With $71.3M in assets under management, this fund has been operational since its inception.
Strategy: Uses aggressive derivative strategies on single stocks to produce yields far above market averages, with corresponding volatility.
XDTE (Roundhill S&P 500 0DTE Income) is a high-risk synthetic income fund managed by Roundhill. It focuses on generating income through strategic holdings. With $362.9M in assets under management, this fund has been operational since its inception.
Strategy: Uses aggressive derivative strategies on single stocks to produce yields far above market averages, with corresponding volatility.
In the head-to-head battle of WDTE vs XDTE, the choice depends on your specific goal. XDTE wins for Immediate Income with a 40.48% yield. However, XDTE is the better choice for Long-Term Growth due to superior total return performance.
Which fund is safer for retirement income? We analyze the yield sustainability and structural risk.
What is a Yield Trap? A yield trap occurs when a fund advertises an attractive headline yield (30.89% in WDTE's case), but that income is partially funded by Return of Capital (ROC) distributions rather than genuine earnings or realized gains. This means you're essentially receiving your own money back, while the fund's NAV erodes.
12-MONTH PERFORMANCE BREAKDOWN:
Why This Matters: For retirees withdrawing income, this creates a double-whammy effect:
⚖️ Verdict: WDTE exhibits classic yield trap characteristics. Income investors should allocate cautiously and consider pairing with capital-preserving assets (Tier 1-2 funds).
What is a Yield Trap? A yield trap occurs when a fund advertises an attractive headline yield (40.48% in XDTE's case), but that income is partially funded by Return of Capital (ROC) distributions rather than genuine earnings or realized gains. This means you're essentially receiving your own money back, while the fund's NAV erodes.
12-MONTH PERFORMANCE BREAKDOWN:
Why This Matters: For retirees withdrawing income, this creates a double-whammy effect:
⚖️ Verdict: XDTE exhibits classic yield trap characteristics. Income investors should allocate cautiously and consider pairing with capital-preserving assets (Tier 1-2 funds).
The Bottom Line Question: If you invest $100,000 today, how much cash will you actually receive each month? Here's the exact math:
WDTE
Annual Yield: 30.89%
$2,574/mo
($30,891/year)
Frequency: weekly
XDTE
Annual Yield: 40.48%
$3,373/mo
($40,481/year)
Frequency: weekly
Income Gap: XDTE generates $9,590/year more than WDTE on the same $100k investment.
Over 20 years, that's $191,790 in additional cash flow (before reinvestment).
Context Matters: Higher income doesn't always mean better investment. Review the "Yield Trap" and "Total Return" sections above—you want income that's sustainable, not just headline-grabbing.
Historical data reveals how these funds behave during market stress. XDTE has delivered a superior Total Return of 22.53% over the past year.
What is an Expense Ratio? The annual fee charged by the fund, expressed as a percentage of assets. It's deducted daily from the fund's NAV, making it invisible to most investors—but it compounds over time.
XDTE (LOWER COST)
0.970%
Annual expense ratio
WDTE (HIGHER COST)
1.030%
Annual expense ratio
20-YEAR FEE IMPACT SIMULATION ($100,000 INITIAL INVESTMENT)
The Hidden Cost of "Just 0.06%": That seemingly small difference of 0.060% annually becomes $1,200 in lost wealth over 20 years. Factor in compound growth, and you're giving up ~$3,032 in potential portfolio value.
💡 Cost Efficiency Winner: XDTE is the clear winner for long-term buy-and-hold investors. Lower fees mean more capital compounds in YOUR account, not the fund manager's.