SoFi Select 500 ETF (SFY) Covered Calls

SoFi Select 500 ETF is an exchange-traded fund that tracks the performance of the Solactive SoFi US 500 Growth Index. The firm utilizes a proprietary "smart beta" strategy, weighting the 500 largest U.S. companies based on fundamental growth signals such as sales and revenue growth. By offering a low-cost vehicle with a fee-waiver structure, the fund provides investors with diversified exposure to large-cap growth stocks across various industrial sectors.

You can sell covered calls on SoFi Select 500 ETF to lower risk and earn monthly income. Born To Sell's covered call screener gives you customized search capabilities across all possible covered calls but here are a couple of examples for SFY (prices last updated Thu 4:16 PM ET):

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The SoFi Select 500 ETF (SFY) is a "Smart Beta" investment vehicle designed to outperform traditional market-cap-weighted indexes. Unlike the standard S&P 500, which weights companies solely by their market value, SFY utilizes a rules-based methodology that weights components based on three key growth signals: trailing 12-month sales growth, trailing 12-month revenue growth, and forward-looking revenue estimates. This approach ensures that capital is concentrated in companies demonstrating actual fundamental expansion rather than just price momentum.

2026 Performance and High-Conviction Holdings

As of April 2026, SFY has established itself as a top-tier performer in the Large-Cap Growth category, boasting a 1-year total return of 37.72%. The fund’s concentrated exposure to the semiconductor and cloud infrastructure sectors has been a primary driver of this alpha. Notably, NVIDIA Corp (NVDA) remains the fund’s largest holding at 13.76%, followed by Broadcom Inc (4.94%) and Microsoft Corp (4.38%). This high-conviction weighting in AI infrastructure enabled the fund to significantly outperform its broad-based benchmarks in the first quarter of 2026.

A major strategic development in early 2026 was SoFi’s pivot toward the "Agentic AI" theme. While SFY remains a diversified large-cap fund, management has optimized the rebalancing filters to favor companies providing the autonomous technology and "Physical AI" layers required for the next stage of the AI supercycle. With a net expense ratio effectively capped at 0.05% through a contractual fee waiver extending into late 2026, SFY remains one of the most cost-efficient growth vehicles for both retail and institutional portfolios.

Competitive Landscape

The Large-Cap Growth segment is one of the most crowded in the ETF industry, with SFY competing against massive legacy funds and low-cost index trackers. Key competitors include:

1. Vanguard Growth ETF: One of the largest growth funds in the world. They compete through a low 0.04% expense ratio and a highly diversified portfolio of over 200 stocks, providing a stable and extremely liquid benchmark for growth investors.
2. Schwab U.S. Large-Cap Growth ETF: A primary low-cost competitor that tracks the Dow Jones U.S. Large-Cap Growth Total Stock Market Index. They compete by offering similar fundamental exposure with deep options liquidity and narrow bid-ask spreads.
3. Invesco QQQ Trust: The definitive benchmark for the Nasdaq-100. They compete for investor capital by offering concentrated exposure to non-financial tech leaders, serving as the most active and liquid optionable peer in the growth space.
4. iShares S&P 500 Growth ETF: A prominent peer that tracks the growth constituents of the S&P 500. They compete by offering a more traditional market-cap-weighted alternative to SFY’s fundamental growth-weighting strategy.

Strategic Outlook and Market Position

The fund is prioritizing "Efficiency over Scale" in late 2026, maintaining a disciplined 29% portfolio turnover rate to minimize capital gains distributions for taxable accounts. Strategic efforts are directed toward refining the Solactive index filters to better capture "Revenue Quality," specifically looking for companies with high free cash flow conversion. Management believes this focus will protect the fund during the projected 2027 normalization of high-flying tech valuations.

With total assets under management reaching approximately $584 million by mid-April 2026, SFY maintains an active options market, allowing for effective covered call and protective put strategies. The fund is currently ranked as a Zacks ETF Rank #1 (Strong Buy), reflecting its strong momentum and low internal cost structure. As the market transitions from generative AI hype to tangible productivity gains, SFY is positioned to capture the growth of companies successfully monetizing advanced autonomous systems.

Want more examples? SFNC Covered Calls | SFYF Covered Calls