Advisors and investors wanting to enhance existing tech exposures or harness volatility in the category for income should consider the award-winning NEOS Nasdaq 100 High Income ETF (QQQI ). The fund remains competitive and a strong performer within its category since inception.
In the ongoing market volatility of the last 18 months, QQQI generated notable returns and distribution rate compared to peers. Distribution rate annualizes the most recent distribution and divides by the fund’s NAV. It’s a forward looking metric of what an investor would earn over the next year should distributions hold steady.
Since inception in January 2024, the fund has outperformed some of the biggest names and drawn ongoing investor attention and flows. QQQI currently has over $2.6 billion in AUM as of June 27, 2025. The fund is actively managed and provides exposure to the Nasdaq-100 Index. Through the options writing strategy, QQQI puts tech stock volatility to work for income. When market drawdowns occur, income earned from the options strategy may offer a level of potential mitigation.
QQQI Combines Tech Exposure With Option Income, Tax-Efficiency
QQQI uses a data-driven covered call options strategy designed to generate high income. Covered calls entail buying an asset while also writing a call on the underlying asset. This generates a premium, but also caps the upside potential should the underlying asset appreciate. QQQI also uses a call spread to achieve its income goals. This allows for greater participation in upside market movements when they occur, compared to indexed covered call option strategies.
See also: QQQI Takes Home ‘Best New Active ETF’ Award
In addition to potential upside capture, the fund offers layers of tax efficiency for income-oriented investors. The options that QQQI uses are call options on the NDX and qualify as section 1256 contracts. These receive favorable tax treatment under IRS rules. The options held at year’s end are treated as if sold at fair market value on the last market day. Any capital gains or losses are taxed at 60% long-term and 40% short-term, no matter how long they were held.
Should equities rise or fall, NEOS can actively manage the call options to capture gains in the underlying assets or minimize losses. In addition, the fund’s managers engage in tax-loss harvesting opportunities throughout the year on the call options, equity holdings, or both.
QQQI has an expense ratio of 0.68%.
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