QQQI: The Undiscovered Nasdaq-100 Covered Call ETF You've Been Looking For (14.4% Distribution Yield)
Portfolio Pulse from Austin Hankwitz
The NEOS Nasdaq-100 High Income ETF (QQQI) aims to offer high monthly income and tax efficiency by replicating the Nasdaq-100 Index and using out-of-the-money covered call strategies. It's introduced by the same team behind the successful NEOS S&P 500 High Income ETF (SPYI), which outperformed other S&P 500 covered call ETFs in 2023. QQQI's strategy differs from the GlobalX Nasdaq 100 Covered Call ETF (QYLD) by aiming for higher income and potential share price appreciation. Early performance shows promising results with a higher distribution yield compared to QYLD.
March 15, 2024 | 7:32 pm
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POSITIVE IMPACT
QQQI, a new ETF replicating the Nasdaq-100 Index with a covered call strategy, shows promising early performance with a higher distribution yield than its competitor QYLD.
Given its innovative approach to generating tax-efficient income while allowing for share price appreciation, QQQI has shown early success. Its higher distribution yield compared to QYLD and the successful track record of the team behind it suggest a positive short-term impact.
CONFIDENCE 80
IMPORTANCE 90
RELEVANCE 100
POSITIVE IMPACT
SPYI, a successful S&P 500 covered call ETF by the same team behind QQQI, outperformed other similar ETFs in 2023 and serves as a model for QQQI's strategy.
SPYI's successful performance in 2023, utilizing an out-of-the-money covered call strategy, sets a positive precedent for QQQI. Its past success and role as a model for QQQI's strategy suggest a positive outlook for SPYI as well.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 70
NEGATIVE IMPACT
QYLD, employing an at-the-money covered call strategy on the Nasdaq-100 Index, shows a lower distribution yield compared to the newly introduced QQQI.
QYLD's at-the-money covered call strategy has resulted in a lower distribution yield compared to QQQI's out-of-the-money strategy. This could lead to a negative short-term impact as investors may favor the higher yielding QQQI.
CONFIDENCE 75
IMPORTANCE 70
RELEVANCE 80