BrightSpire Capital: A 12% Yield Opportunity with a Safety Net

The average holding period for an investor is decreasing, with many investors holding onto their investments for a shorter period of time. This is partly due to the increasing volatility of the market and the desire for quicker returns. However, there are still some investments that offer a high yield and are considered to be covered, such as BrightSpire Capital, which has a 12% yield.

The average holding period for investors is decreasing, with many choosing to hold onto their investments for shorter periods due to the increasing volatility of the market and the desire for quicker returns. However, there are still investment options that offer high yields and are considered covered, such as BrightSpire Capital, which has a 12% yield.

In response to this trend, financial firms have developed High Income SharesTM, single stock ETFs that offer exposure to US companies and seek to generate high monthly income through an active covered call strategy. Enhanced High Income SharesTM, which apply modest leverage to the covered call strategy, aim to pay even higher monthly income.

The Harvest Diversified High Income Shares ETF (HHIS), for instance, has a monthly distribution of $0.25 per unit and an AUM of $699.75M [1]. This ETF seeks to generate income from a covered call strategy while participating in the long-term growth of the underlying stocks.

Similarly, the Harvest NVIDIA Enhanced High Income Shares ETF (NVHE) offers exposure to NVIDIA (NVDA) and has a monthly distribution of $0.22 per unit and an AUM of $159.42M [1]. NVIDIA is a key player in the AI and data center GPU market, and its stock has seen significant growth, with analysts expecting revenue to grow 52% in the second quarter [1].

The increasing demand for cloud infrastructure and AI models is driving up capex spending at major tech companies. Microsoft, for example, expects to remain capacity constrained through the first half of its fiscal year, which could translate into increased demand for NVIDIA's GPUs [1].

While the average holding period is decreasing, these High Income SharesTM ETFs provide a way for investors to generate income from their investments while also participating in the long-term growth of the underlying stocks. These ETFs are particularly attractive to investors seeking to generate high monthly income in a volatile market.

References:
[1] https://www.nasdaq.com/articles/1-microsoft-quote-nvidia-investors-have-hear
[2] https://harvestportfolios.com/high-income-shares/