## [# Behind the Ticker: The QDPL ETF](/sections/podcasts/behind-ticker-qdpl-etf)
# Behind the Ticker: The QDPL ETF
In this episode of *Behind the Ticker,* Brad Roth talks the founding of Pacer ETFs with Sean O'Hara, how the firm's strategies have grown over time, and their solve for baby boomer income needs with the [**Pacer Metaurus US Large Cap Dividend Multiplier 400 ETF (QDPL)**](https://www.etf.com/QDPL).
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[By Behind The Ticker](/authors/behind-ticker)
Mar 16, 2026
Edited by: ETF.com Staff
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Behind the Ticker offers investors a chance to get under the hood of newer or more niche ETFs. Brad Roth, Managing Partner and CIO of Thor Financial Technologies, talks strategy and the human side of investing and ETFs with the individuals bringing these funds to market.
In this episode, Roth talks with Sean O'Hara, President of Pacer ETFs Distributors about the start of Pacer, the long track-record the firm has in ETFs, and how the ETF line-up has grown and evolved over time. The two dig into the [**Pacer Metaurus US Large Cap Dividend Multiplier 400 ETF (QDPL)**](https://www.etf.com/QDPL).
You can also listen to this episode on [**Spotify**](https://open.spotify.com/episode/49YaTNYi4YvvbFWmsJcsJ0?si=30d8a3dd55024620), [**Apple Podcasts**](https://podcasts.apple.com/us/podcast/4x-s-p-income-without-covered-calls-sean-ohara-pacer-qdpl/id1682702118?i=1000755351656), or your preferred streaming platform.
## The Genesis of Pacer
Sean O'Hara has been in the financial services industry since 1985, starting on the retail side before quickly moving into wholesaling at a company called Planco, an annuity distributor. Planco was eventually acquired by the Hartford, and Sean helped them build out a mutual fund platform, a 401k platform, and expand their business into Canada, Japan, and the UK. He rose to run all sales and distribution for the company. In 2007, after decades of building distribution infrastructure for someone else, Sean and Joe Thompson — the original founder of Planco and a longtime friend — decided to go out on their own. The initial plan was to be a third-party distributor for other firms, but after what Sean described as a couple of rocky relationships, the pivot to building their own ETF business emerged. Pacer launched its first ETFs in 2015, starting with three risk management strategies called Trend Pilots that used a 200-day simple moving average as a signal — you either owned the S&P or you owned T-bills. From there they built out value strategies, growth strategies, and fixed income products. Today the firm manages approximately $42 billion across 57 products with more in the pipeline.
Sean framed Pacer's positioning clearly: the ETF landscape is dominated by the big three offering cheap beta, and there's no point competing there on scale or fees. Everything Pacer builds has to be innovative, disruptive, or unique, with a specific outcome in mind — whether that's higher returns, risk management, a new approach to income, or something nobody else has thought of. He described most of Pacer's products as completion positions rather than core holdings. If an advisor already owns the S&P 500 or the Nasdaq through a standard ETF, Pacer offers complementary ways to own that exposure with added features like downside management, enhanced income, or excess return potential.
## Solving for Baby Boomer Income Needs
The main focus of the conversation was [**QDPL**](https://www.etf.com/QDPL), Pacer's enhanced income strategy built on top of the S&P 500. Sean was quick to clarify there's no leverage in the product, despite what some people assume. The problem QDPL solves is straightforward: as baby boomers transition into the income phase of their lives, the traditional approaches to generating yield from equities have significant drawbacks. Dividend-focused strategies like [**NOBL**](https://www.etf.com/NOBL) (the ProShares S&P 500 Dividend Aristocrats ETF) force investors into sectors with limited growth prospects — utilities, financials, real estate — meaning you're trading future growth for current cash flow. Covered call strategies like [**JEPI**](https://www.etf.com/JEPI) deliver attractive yields but severely cap upside participation. In both cases, investors struggle to grow principal fast enough to keep income ahead of inflation over time.
QDPL's mechanics work like this: 85% of the fund is invested directly in the S&P 500, which serves as the growth engine. The remaining 15% goes into Treasury bills, which earn a small yield but more importantly serve as collateral against dividend futures contracts. There's a large, liquid market in S&P 500 dividend futures, and by combining the T-bill collateral with those futures, QDPL is designed to deliver four times the current S&P 500 dividend yield. At today's levels, that translates to roughly a 5% cash flow on a portfolio that's 85% invested in the S&P. The fund rebalances once per year, and the equity exposure can flex between roughly 80% and 90% depending on movements in the futures market, but the target is always that four-times yield multiplier.
Sean highlighted two additional features that make the product compelling beyond the headline yield. First, the bulk of QDPL's distributions are classified as return of capital, making them tax-free to the investor. He explained the mechanics: when a stock pays a dividend, the stock price drops by the dividend amount — the company is giving your money back, but you owe taxes on it as ordinary income. The way QDPL's dividend futures interaction works, the distribution is instead treated as a return of principal, shifting the tax burden entirely. Second, there's an embedded growth tailwind: S&P 500 dividends historically grow 5-7% per year across the full basket, and when Pacer enters into the dividend futures contracts, they're paying a discount to the previous year's actual dividend payments. If dividends grow as expected, the fund earns more back on those futures than it paid, generating additional return.
On the risk side, Sean was direct about the trade-offs. The primary cost is reduced equity exposure — your beta is roughly 0.85, so you're getting approximately 85% of the S&P's upside and 85% of its downside on the price return side, with a small buffer from T-bill interest income. The dividend futures themselves carry risk: if S&P dividends were to decline meaningfully, the value of those futures would drop. Sean walked through the math — if the futures were priced at $71 and dividends fell 10%, the future would be worth about $64, creating a loss on the 15% of the portfolio allocated there. But he pointed out that a broad decline in S&P dividends requires either a massive market dislocation or extreme fear. He used COVID as the clearest example: dividend futures collapsed early in 2020 as everyone assumed companies would slash dividends, but by year-end the actual value of those futures was higher because the market overreacted. Companies broadly resist cutting dividends because it's viewed negatively and hurts their stock price.
## Use Cases of QDPL
Brad asked how advisors should position QDPL in a diversified portfolio. Sean laid out a practical framework: take a 50/50 blend of QDPL and SPY, and you end up with 92.5% S&P 500 exposure but more than double the income — roughly a 2.7-2.8% yield versus the S&P's current 1.25%. You haven't meaningfully changed what you own, but you've dramatically improved your cash flow. Alternatively, because QDPL has slightly less equity exposure, an advisor could justify increasing their overall equity allocation while still maintaining a risk profile similar to a full S&P position. Sean also argued that the timing is more pressing now than when the product launched four years ago — with short-term yields falling back toward 3%, taxable investors are losing to inflation after taxes on their cash and short-duration positions. They need a better source of return, and QDPL offers equity-like growth with a meaningful income stream.
Sean also discussed the sister product [**QSIX**](https://www.etf.com/QSIX), which applies the same dividend futures mechanics to the Nasdaq-100. Because the Nasdaq's dividend yield is only about 0.8%, QSIX delivers six times that yield, getting investors to roughly 5% cash flow. The Nasdaq dividend story has an additional growth angle: Nasdaq dividends have been growing 11-13% annually, and in 2020 they grew 33% when two major Mag Seven names initiated dividend payments. If remaining holdouts in the Nasdaq start paying dividends, the value of those dividend futures would increase dramatically.
The conversation then broadened to Pacer's overall approach to product development and distribution. Sean described their origin story with QDPL: the underlying concept came from a firm called Metaurus, which had originally filed for separate price-only and dividend-only ETFs but couldn't gain traction because they lacked distribution capabilities. When they brought the idea to Pacer, Sean's team simplified it — instead of making advisors figure out the allocation between price return and dividend components, they packaged it into a single product. They launched both a four-times version (QDPL) and a three-times version (TRPL). All the money went to the four-times product, so they killed the three-times version.
On distribution, Sean described Pacer's model as deliberately old-fashioned and high-cost. They have 78 external salespeople in territories across the country, 39 internals backing them up, six divisional managers, and a national sales manager — roughly 120 people on the sales side. He broke the market into segments: wirehouses like Merrill, Morgan Stanley, Wells Fargo, UBS, and Raymond James; independent broker-dealers like LPL; pure RIAs who charge for advice rather than selling products; and smaller independent, bank, and insurance company broker-dealers. Sean was candid that you're not getting on a wirehouse platform out of the gate — you have to build AUM and momentum through the RIA and independent channels first, then use that groundswell to earn wirehouse access. He acknowledged it's an expensive model, which is why most firms don't do it, but argued it's irreplaceable because the value comes from understanding how each advisor runs their business and helping them solve specific problems.
Sean also highlighted Pacer's patience as a privately held firm. He told the story of [**SRVR**](https://www.etf.com/SRVR), a data center real estate ETF they launched eight years ago based on the 5G thesis. It struggled during rising interest rates but has recently taken off with the AI-driven data center boom. They recently added a power sleeve to the fund, recognizing that behind-the-meter power generation is becoming essential for data center operators. That led to [**TRFK**](https://www.etf.com/TRFK), an ETF that essentially takes everything inside a data center — hardware, software, chips, networking, cybersecurity, cooling — and builds a portfolio around it. TRFK did very little for its first 18 months to two years but has averaged over 30% annually since launch, and money is now flowing in. Sean's point was that being privately held means they can afford to let products sit and wait for the market to catch up to the thesis, as long as there's a real client need behind it. They won't launch anything they wouldn't want to own themselves — no 5X leveraged products, no crypto, nothing gimmicky.
When asked about what's changed in the ETF industry over the past decade, Sean pointed to lower product launch costs and increased creativity as positives, citing buffered ETFs as a good example of innovation that brought structured note payouts into a more accessible ETF wrapper. On the negative side, he flagged market maker balance sheet constraints as an underappreciated challenge. Market makers seed new ETFs, and if a fund never raises money, that seed capital sits on the market maker's balance sheet with no way to exit. Treasury departments at those firms eventually start asking questions. Sean's advice was blunt: if you're starting from scratch today with a dream of launching an ETF and waiting for people to find it, you're in a tough spot. Having a track record of getting market makers out of their seed and running meaningful volume is what earns you continued support.
Advisors and investors wanting to learn more can go to [**PacerETFs.com**](https://www.paceretfs.com) or to ask their financial advisor about Pacer's full product suite.
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*Disclaimer: The market insights, projections, and investment strategies expressed in this podcast are solely those of the contributor and do not necessarily reflect the views or opinions of ETF.com This content is provided for informational purposes and does not constitute financial, investment, or legal advice.*
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