Maximizing Returns: A Tactical Approach to Income With DIVO

For income-focused investors looking beyond traditional bond yields without giving up stock market participation, the Amplify CWP Enhanced Dividend Income ETF (DIVO A-) offers a tactical solution. Amplify ETFs Founder and CEO Christian Magoon appeared on Bloomberg’s ETF IQ to discuss.Key Takeaways Amplify ETFs Founder and CEO Christian Magoon appeared on Bloomberg’s ETF IQ to discuss the Amplify CWP Enhanced Dividend Income ETF (DIVO). DIVO has added $1.4 billion in new assets in 2026. DIVO and IDVO utilize a “three-engine” approach to returns, combining dividend income, option income from covered calls, and capital appreciation. DIVO distinguishes itself from other income-oriented products such as the JPMorgan Equity Premium Income ETF (JEPI), through a focus on high-quality stocks with strong dividend and earnings growth. A 3-Engine Approach to ReturnsDIVO provides actively managed exposure to high-quality U.S. blue-chip companies with a history of dividend and earnings growth. This is paired with a covered call strategy to generate additional income on top of high dividend yields. DIVO has returned 10.36% year to date as of August 5, with inflows of $1.44 billion in 2026. “We’ve benefited from a fair amount of the market volatility where people are looking for maybe a seat belt on their equity exposure and to not just rely on their total return coming from capital appreciation, but instead having multiple sources of return, dividend income, option income, plus capital appreciation to have like a plane with lets just say three engines versus just one,” said Magoon.Quality and Tactical FlexibilityWhile covered call ETFs surged in popularity among income-seeking investors, they are not all built the same. Popular funds like the JPMorgan Equity Premium Income ETF (JEPI A) often rely on broad market exposure and systematic option writing. However, Amplify takes a different approach with DIVO, according to Magoon. “I would distinguish DIVO in several different ways,” Magoon noted. “One is that DIVO is focusing on higher quality stocks in my opinion than JEPI. So we’re looking at companies that are growing their earnings and growing their dividends. We’re not buying for example, kind of S&P exposure. Second, we are buying dividend-paying stocks that have a measure of ballast or protection during downturns.” “We can flex up the covered calls during times of market volatility. So you’ll see that there’s some very nice defensiveness from DIVO because of the high-quality focus, because of the dividends and the ability to flex up on covered call writing,” he added.DIVO Portfolio CompositionDIVO maintains a concentrated portfolio of 34 holdings, with companies such as Microsoft (MSFT), Caterpillar (CAT), and Apple (AAPL) serving as top allocations. The fund is heavily weighted towards the financial, information technology (IT), and industrial sectors. These three sectors account for approximately 56% of DIVO’s weight. “We want to have exposure to all of the S&P sectors. However, the portfolio manager because they are looking at earnings growth and dividend growth tend to favor some of the sectors that have better historical metrics there,” Magoon explained. “Technology as you know isn’t maybe as focused in that they’re more growth stocks. So you do see a bit of a value tilt in this strategy, but we’re not abandoning the technology and communication names.”Expanding Globally With IDVOTaking a global approach, the Amplify CWP International Enhanced Dividend Income ETF (IDVO ) provides high-quality international exposure to companies with a history of dividend and earnings growth through ADRs. Similar to DIVO, IDVO uses a covered call strategy on individual securities to generate an additional source of income. The fund has gained 15.72% in 2026 with inflows of $664.36 million over the same period. “We’re looking for quality companies and companies that are paying dividends. So it’s a very similar value proposition to DIVO, but on the international side, and certainly all the capital appreciation that has come from international. We’ve been able to participate there with IDVO, as well as garner a little bit higher income from the dividend and the covered call writing. There’s just a little bit more volatility in those companies,” said Magoon. For more news, information, and strategy, visit ETFdb.