YieldMax's Buffett Tracking BRKC Pays 2.78% While Treasuries Yield 4.15%, and That Gap Is Hard to Ignore

YieldMax BRK.B Option Income Strategy ETF (NYSEARCA:BRKC) launched in June 2025 with a straightforward offer: take Berkshire Hathaway’s steady, low-volatility profile and layer an options income strategy on top to generate monthly distributions. For investors who want exposure to one of the most respected businesses in America but also want a regular cash payment, that sounds like a clean solution. The reality is more nuanced.

BRKC does not hold Berkshire Hathaway (NYSE:BRK-B) shares directly. Instead, it uses a synthetic covered call structure, replicating BRK.B exposure through options while simultaneously selling call options to collect premium income. That premium gets distributed to shareholders monthly. The fund’s 0.01 net expense ratio looks cheap on the surface, but the real cost of this strategy is the upside you give away every time a call is sold above the current price.

The return engine here is option premium, not business earnings or dividend growth. When volatility rises, premiums get richer and distributions can increase. When markets are calm, premiums compress and payouts shrink. That is a fundamentally different income source than a bond coupon or a dividend from an operating business.

BRKC’s 2.78% dividend yield is the central tension in this fund’s story. The 10-year Treasury currently yields 4.15%, meaning a risk-free government bond is paying more than this equity-risk options product. That gap matters because investors in a synthetic covered call structure are taking on complexity and capped upside — and the income on offer does not currently compensate for that tradeoff.

Price performance since inception reinforces this concern. BRKC has returned -0.77% since its June 2025 launch date. Over the same window, BRK-B itself returned -0.12%. The options overlay has not added value on a total return basis in BRKC’s short life so far, though the fund is only about nine months old and that window is too short to draw firm conclusions.

One genuine tailwind for BRKC right now is the VIX. The fear gauge sits at 25.50, up 44% from a month ago and in the 92nd percentile of readings over the past year. Elevated volatility inflates option premiums, which is exactly the input that drives BRKC’s distributions. If the VIX stays elevated through spring, near-term payouts could be richer than the fund’s trailing yield implies.

The flip side: Berkshire is among the least volatile large-cap stocks in the market. BRK-B’s muted price swings mean the options written on it generate thinner premiums than, say, a YieldMax product built on a high-beta tech name. The low-volatility quality that makes Berkshire a trusted long-term holding is the same quality that limits how much premium BRKC can realistically extract.

The covered call structure is the central tradeoff. If BRK-B rallies sharply, BRKC shareholders miss gains above the strike price sold — Berkshire has historically delivered strong long-term price appreciation, and an options overlay would clip a meaningful portion of any sharp rally above the strike price sold. Meanwhile, the 2.78% yield still does not clear the Treasury hurdle, so the income argument requires believing distributions will grow from current levels.

There is also a practical consideration around fund size. With only $21 million in net assets, BRKC is a very young and thinly-traded product. Bid-ask spreads and liquidity deserve careful attention before sizing any position, particularly for investors accustomed to the deep liquidity of BRK-B itself.

The fund uses a covered call structure that caps upside participation in BRK-B rallies while generating monthly distributions. The options overlay is a structural characteristic that differs from direct ownership of BRK-B shares, where price appreciation is uncapped. Fund size and liquidity remain considerations given the $21 million in net assets.