QQQI: NEOS NASDAQ-100(R) HIGH INCOME ETF
Understanding the NEOS NASDAQ-100(R) HIGH INCOME ETF (QQQI)
What this ETF is trying to do
The NEOS NASDAQ-100(R) HIGH INCOME ETF (ticker: QQQI) is an exchange-traded fund designed to generate income. It uses strategies like covered calls and options to try to provide cash to its investors. This type of ETF focuses on providing regular payments while holding a variety of stocks.
What the numbers show
When looking at an ETF, it is important to separate the share price from the total return.
• Price Return: This measures only how much the share price has changed. For QQQI, the year-to-date (YTD) price return is approximately 4.47%. Over the last year, the one-year price return was approximately 2.44%.
• Total Return: This is a more complete picture because it includes the value of the cash distributions paid out. The YTD total return is approximately 16.13%, and the one-year total return is approximately 17.94%.
To visualize the price change, we can look at an estimated price from roughly one year ago, which was $54.93. The current price is $56.27.
Top Holdings
The ETF holds 107 different assets. Because the list provided is a partial list, these are only the largest holdings:
• NVIDIA CORP (8.52%)
• APPLE INC (7.59%)
• MICROSOFT CORP (5.68%)
• MICRON TECHNOLOGY INC (5.24%)
• ADVANCED MICRO DEVICES INC (4.32%)
• AMAZON.COM INC (4.22%)
• META PLATFORMS INC CLASS A (3.36%)
• ALPHABET INC CLASS A (3.14%)
• TESLA INC (2.92%)
• ALPHABET INC CLASS C (2.91%)
*Note: Holdings can change over time.*
Income and distribution explanation
This ETF is designed for income. The distribution yield is approximately 13.58%. This means the cash distributions are quite high relative to the ETF's price. These payments usually happen monthly, with 12 payments recorded over the last year. It is important to remember that a high distribution yield is not the same as total return, and high payouts do not guarantee your original investment will stay the same.
NAV erosion explanation
"NAV erosion" refers to a decline in the Net Asset Value (the actual value of the fund's assets). While some investors worry that high payouts might cause the fund to lose value, QQQI has an erosion-risk score of 94. This is labeled as "Stable / sideways," and the erosion severity is rated as "good." There is no severe erosion-risk flag for this ETF.
Pros
• Provides a high distribution yield for income seekers.
• The total return has been higher than the price return, meaning distributions have added significant value.
• The erosion-risk score suggests a stable trend.
Cons
• The share price itself has grown more slowly than the total return.
• High-income strategies can be complex due to the use of options.
Beginner takeaway
QQQI is an income-focused ETF that uses options to pay out cash. While the share price has seen modest growth, the total return is much higher because of the large distributions. Always remember that high yields are not a guarantee of performance, and it is important to look at both price changes and total returns together.
Top Holdings
Structured portfolio holdings supplied by the ETF data provider. These figures are not generated by the AI article.
| # | Holding | Ticker | Weight |
|---|---|---|---|
| 1 | NVIDIA CORP | NVDA | 8.52% |
| 2 | APPLE INC | AAPL | 7.59% |
| 3 | MICROSOFT CORP | MSFT | 5.68% |
| 4 | MICRON TECHNOLOGY INC | MU | 5.24% |
| 5 | ADVANCED MICRO DEVICES INC | AMD | 4.32% |
| 6 | AMAZON.COM INC | AMZN | 4.22% |
| 7 | META PLATFORMS INC CLASS A | META | 3.36% |
| 8 | ALPHABET INC CLASS A | GOOGL | 3.14% |
| 9 | TESLA INC | TSLA | 2.92% |
| 10 | ALPHABET INC CLASS C | GOOG | 2.91% |