Weekly Dividend ETF COIW Pays 52 Times Per Year But 100% Return of Capital Raises Red Flags for Retirees

"The Roundhill COIN WeeklyPay ETF ( NYSEARCA:COIW) offers 52 dividend payments per year, a huge improvement over the quarterly payments of most ETFs, and a newer cohort of monthly yield options. Launched in February 2025, COIW targets weekly distributions while providing 120% leveraged exposure to Coinbase Global ( NASDAQ:COIN) through total return swaps. However, more frequent income doesn't mean safer income, and COIW's distribution pattern shows exactly why."

"This creates extreme distribution volatility. Over the past 12 weeks, COIW's payments ranged from $0.18 to $1.16 per share, a 6.4x variation. The October 14 payment hit $1.16, while the December 1 payment dropped to $0.18. This unpredictability makes budgeting impossible for income-focused investors. COIW's distributions aren't funded by traditional dividend income. Coinbase pays no dividends, generating zero passive income for the ETF. Instead, distributions come from swap-based returns and volatility-dependent calculations."

COIW targets weekly distributions while obtaining 120% leveraged exposure to Coinbase through total return swaps rather than owning stock. Weekly payouts are calculated by a proprietary formula that factors COIN price performance and implied volatility, with no covered-call income and uncapped upside but 20% amplified downside. Weekly payments have varied widely, creating unpredictable cash flows. Filings estimate distributions as 100% return of capital because Coinbase pays no dividends, so payouts do not represent traditional income and reduce cost basis. Return-of-capital distributions can defer taxes but raise future capital gains and may indicate unsustainable payout levels amid Coinbase's extreme volatility.

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