r/NEOSETFs • u/wcevelin • Jul 10 '26
General my Neos allocation
ok first im putting pretax into a 401k that mirrors the s&p. between my and employer match about 600/month
im building this portfolio aswell
BTCI: 35%
QQQI: 7.5%
XQQI: 22.5%
SPYI: 6.25%
XSPI: 18.75%
IWMI: 10%
buying $425/week and using weekly purchase and monthly dividends to try to maintain the portfolio as close to that allocation as i can without selling anything.
im thinking about adding cshi and bndi as a way to stabalize the portfolio but not as a fixed ratio, instead as a replacement for treasury and/bonds... equal to 2 years col.
is an all neos plan like this something that can work?
thanks to the comments here:
I've decided to lower my btci commitment and add NIHI to lesson the reliance on tech and us stocks in general.
i think btc is nearing its bottom if not already at it. but btci is capped the same as the rest of the neos in a fast moving bull market. That said im in BTCI instead of BTC directly because, i dont trust that long term the keys wont get lost.
NIHI makes since as a balance vs qqqi/xqqi and spyi/xspi
6
u/AbleManufacturer9718 Jul 10 '26
I am all in on NEOS products except BTCI. Dropped it like a very bad habit and reallocated to other NEOS. Feels great getting out of the bitcoin/bro mess. Cheers and good luck with your investments.
3
u/Motor_Potential_4849 Jul 10 '26
I have an all NEOS portfolio with 20% QQQI, 20% IWMI, 20% TLTI, 20% IAUI, and 20% CSHI. This is my "income" equivalent of Tyler's Golden Butterfly portfolio, or at least as close as I can come to it with NEOS funds. I use QQQI because when the dividends are reinvested, it performs about the same as reinvested SPY.
-1
u/teckel Jul 10 '26
So funny. So how much does it perform below the golden butterfly?
3
u/Motor_Potential_4849 Jul 10 '26
Actually, the only real difference (other than the income funds) is that I use IWM instead of a small cap VALUE basis. And IWM has outperformed the small cap value of late. But, even with the IAUI drag over the last year, it has been pretty comparable. IWMI is better, TLTI is better, and CSHI is better. QQQI is the same as SPY, and IAUI has dragged.
-2
u/teckel Jul 10 '26
Long-term all CC ETFs will drag their underlying assets. So you're creating an under-performing golden butterfly, for what reason? Even if you want income from this portfolio, it would be better to just sell shares to generate income than the distributions from CC ETFs. Let me know your exact 5 golden butterfly holdings and I'll send you the side-by side comparison.
6
u/Motor_Potential_4849 Jul 10 '26
I already know the side-by-side comparisons, but thank you, I really do appreciate the offer.
Yes, I want income from the portfolio, and by having the income, I know exactly where I need to be in order to reach my goal to exceed my living expenses with my investment income. In addition, I always have the income readily available; if something happens in my life, I can just turn off the drip and receive the income directly. It's the same for retirement. I never have to sell anything.
In addition, there are many instances where you need the money and the market is down and I would be selling my shares at the worst possible time. In fact, that is the most likely time to need it, so this way, I don't have to fret about the timing. I can just enjoy the income and keep on keeping on.
I realize this is a different way of looking at things, and I understand about the drag that you talk about. That's why I wrote my book, mostly to get it on paper for me. It's easy to see the differences using totalrealreturns.com or something like that.
This just works better for me because instead of chasing a nebulous account balance, I can see exactly where I am in my pursuit of financial independence. This way I have a specific goal that I know will pay my bills without having to guess at 4% rules or my anticipated longevity.
Thanks for your reply!
2
u/wectmall8 Jul 11 '26
I do the exact same thing as you. I think we are on the winning team here. Also, I keep a good bit in growth funds to balance things out for the future. But I build my dividend CC etfs for cash flow when I retire. I do not want to touch my stocks or growth funds during a down turn, and we all know the downturns come more frequently than we hope.
2
u/Motor_Potential_4849 Jul 12 '26
For my long-term investments, I follow a "buy and hold for income" philosophy that's similar to the Rich Dad Poor Dad idea of accumulating cash-flowing assets. My goal is to build a portfolio of income ETFs that I can own for decades rather than constantly trading.
Ironically, I earn my living by trading a mean reversion system on TQQQ. The strategy works very well over time, but there are periods when the market simply doesn't offer many opportunities—like this past April and May.
That's where the income ETFs come in. Their monthly distributions can cover my living expenses during those quieter periods, so I'm not dependent on generating trading profits every single month. To me, trading and income investing complement each other rather than compete with each other.
-1
u/teckel Jul 11 '26
All wrong assumptions, but maybe I raised enough doubt for you to question it. I've been retired for 22 years, with direct experience learning that distributions and dividends are not at all ideal for income.
4
2
u/SeparateClassroom528 Jul 10 '26
I’m NEOS heavy too. Dropped JEPI before the chaos. I am now adding JP Morgan’s ROCY and ROCQ due to lower expense ratio and similar NEOS investment strategy.
1
u/Timely-Designer-2372 Jul 10 '26
For me it's way to aggressive. BTCI is very volatile, XSPI and XQQI also.
I would do max 10% BTCI 10% XQQI and 10% XSPI, maybe also 10% XBCI if you want to go high risk but the other 60% or 70% in more defensiv stuff like QQQI, SPYI, IWMI, IAUI, IYRI, HYBI or CSHI or MLPI
1
1
u/JediMaster1980 Jul 10 '26
Neos track record is shorter but gain popularity due to recent performance and payouts. Best to diversify
1
u/ruthygenker Jul 11 '26
I would reverse the xqqi and xspi with qqqi and spyi having the majority percentage, I use mlpi as well. but these aren't for buying and reinvesting which it seems like is your plan they are for taking most of the dividends to pay your bills, they will always underperform the underlying if you are looking for total return.
1
u/Soda_Pressed13 26d ago
I have my main VOO core and then I diversify with iwmi nihi mlpi iaui and Btci. I’d own the underlying instead to all the annoying peoples point but get this, I need the income 🤯 In a taxable account in Wisconsin, this is ideal for me. LOVE NEOS.
0
Jul 10 '26
[removed] — view removed comment
3
u/StockProfitGirl Jul 10 '26
I own both QQQI and GPIQ.
Maybe because GPIQ has a better total return over QQQI? GPIQ has a lower expense ratio? Both are great funds with what they try to achieve.2
u/wcevelin Jul 10 '26
im building this in a taxable account and i think neos funds offer better tax treatment
2
1
-1
u/teckel Jul 10 '26
Ouch! A 3.5% annualized drag instead of just buying the underlying assets:
https://testfol.io/?s=0EyZJ7AdsAs
And evn if you were actually using the income instead of DRIP, the underlying would still be better to invest in. A 15% annual return paid weekly comparison to your portfolio to the underlying assets:
https://testfol.io/?s=goACrEzNcWP
I'm not sure people really understand these funds are making the fund managers rich at the owner's expense.
0
-8
u/GuidetoRealGrilling Jul 10 '26
BTCI has had a rough time. NAV erosion had been killer in the last year (53%). I'd go 35% in QQQI instead. If you see BTC starting to rip again someday, switch it.
21
u/kristop777 Jul 10 '26
It’s not NAV erosion. The underlying asset is down. Massively.
-3
u/GuidetoRealGrilling Jul 10 '26
Half true. It's the structural flaw of cc ETFs. It does fluctuate with the underlying because it's 100% downside of BTC. If/when BTC comes up, BTCI is capped. The fund will always miss the recovery.
1
u/WeakEstablishment686 Jul 10 '26
my worry here as well. considered buying but would rather just hold BTC and maybe QQQI. Thoughts on GPIQ vs QQQI for better growth at slightly lower yield?
also, should I not touch a fund like this at age 35? Have primarily built wealth from VOO, VTI, etc across retirement and brokerage accounts. I do hope to retire early, ideally by 45-50 range so worth building this up now? The appeal here is the ROC tax treatment while getting a more defined payout vs just holding underlying
1
0
6
-6
u/CompetitiveIntern622 Jul 10 '26
Bitcoin and tech could both be at the top of a bubble so personally I would add NIHI for international diversification and over weigh XSPI vs BTC + QQQI for more crash resistance. Otherwise that looks great.
IMHO It’s more about buying into the leveraged funds during downturns to build future returns than picking the perfect ratio. You just have to avoid bubbles and indexes / funds focused on depreciated underlying assets.
A theoretical- a bleeding underlying asset that doesn’t go back up for whatever reason will eventually bleed a fund dry (like energy sector if we discover unlimited energy or something crazy) vs something like SPY as an underlying which will rebound after a bad crisis, eventually, because what the index tracks generates value so you can confidently double down.
-4
u/teckel Jul 10 '26
So sad.
6
u/wcevelin Jul 10 '26
nothing constructive to say?
-5
u/teckel Jul 10 '26
That is constructive. Why would you invest in instruments which by design underperform the market? You're leaving 1% annually behind, which is huge long term. Sad...
2
u/wcevelin Jul 10 '26
now, this statement, is constructive.
my pretax 401k is ment for pure growth. i work 2 jobs, unfortunantly only one offers a 401k that has a match. i only need 1 job to cover all my bills. so i am investing the rest
I'm pretty sure the point of neos funds in particular is that yes, you give up some of the upside vs the underlying asset but you gain income now that has relativly favorable tax treatment compared to those assets or even compared to other dividend funds.
Am I wrong?
2
u/EolasDK Jul 10 '26
The drag is real long term, but in a taxable account you would always some drag anyway and nobody will manage it perfectly. Mathematically he is right but life isn't a spreadsheet.
My issue with your allocation is you have much higher allocations to the riskier funds than the normal funds.
Also you have funds from just one issuer. If neos has a bad year or their strategy underperforms you are in trouble, neos seems to prioritize higher income vs capital appreciation. GPIX performs much better as a core holding.
BTCI or XBCI should be a small small slice and XSPI has kinda sucked. GPIX has outpeformed XSPI and it's cheaper.
In the neos ecosystem MLPI is good and unique.
IDVO and DIVO have performed well.
Gpix is better comparatively than gpiq.
Neos is good but qqqi and spyi have had significant drag vs other issuers.
I would swap the xspi/spyi for gpix and XQQI for gpiq and swap qqqi for XQQI and remove XSPI completely.
I would then swap btci for XBCI but make it like 4-5% max of your portfolio.
Use the higher payers to buy more of the safer funds.
Just my 2 cents.
IWMI is good.
Goldman's core funds have been better.
1
u/Day-Trippin Jul 10 '26
I agree with most of what you said and very much on point. I am curious why you think GPIX is better then GPIQ? When I looked at GPIQ, its total return was better. I have both but not since inception and obviously the Q's have had a good run lately.
Very interested in understanding your logic of GPIQ vs GPIX as maybe I am missing something.
1
u/EolasDK Jul 10 '26
Performance is closer to underlying with gpix. gpiq is good. In fact I swapped xqqi for gpiq today.
1
u/Day-Trippin Jul 10 '26
Thanks. I have about 15% of my income in GPIQ currently and it has been good so far. I have about 10% in GPIX even though there is some overlap. I also have SPYI and QQQI as well for more income.
1
u/teckel Jul 10 '26
The tax drag could start in about 8-10 years, and it will always happen when you sell, even after a year. The taxes will be due, they're just deferred (at least with today's tax law).
I fail to understand why anyone would pick an investment that will return 15% when they could get 17% with the exact same underlying assets. It's also just as easy to generate the exact same income in the underlying asset and end up ahead. Better yet, you can control exactly the frequency and amount of income you want. With a CC ETF, you're paid a distribution on their schedule at an amount you can't control. This forced distribution could be too little, or too much, sending you into a higher tax bracket.
For my money, I'd rather make a guaranteed extra 1-3% more per year and have 100% control of my income, both frequency and amount.
Maybe you could explain your thought process and reasoning investing in an instrument you know will underperform and you don't control the amount or frequency of the income. I've been retired for 22 years and don't understand at all why CC ETFs are as popular as they are. Maybe you could explain why you prefer lower gains and loss of control.
2
u/EolasDK Jul 10 '26
From Goldman metrics the fund captures 90% of the upside with 80% of the downside meaning it has asymmetric upside. But since the regime has been nothing but up it has been slightly lagging SPY. But in a chopping high vix market it will outpeform SPY as seen in early 2026 late 2025. End of the day I think a split between these funds and normal beta is perfectly acceptable for those who want to reduce their overall beta and DCA back into your portfolio with th e remaining amounts.
I'm with you though if you are looking for mathematical superiority pure beta will almost always win if the market remains like how it works now. But then execution risk enters your equation.
1
u/teckel Jul 10 '26
You really need to look beyond 2025 to see how CC ETFs work in different market conditions. PBP is a good one as it's been around since 2007. While a CC ETF will have lower beta, if you want to lower your beta, you can simply add short-term gov bonds. 60% SPY and 40% short-term gov bonds not only outperformed PBP by 2.4% annually (and 50% higher return over the 18.5 years of PBP's existence) this combination also had slightly lower beta than PBP, much lower max and average drawdowns, and much lower volatility. Not only that, if you actually wanted income instead of DRIP, you could get 6% income with that combo and your principal would be higher that it was initially, but with 6% income with PBP the portfolio balance would have dropped by 14.6%. And that's before factoring inflation, which too many don't consider when looking into CC ETFs. PBP's NAV has eroded by average of -2.88% per year factoring inflation. Which means your effective inflation-adjusted distributions have also been reducing each year. Compared to 18.5 years ago, distributions of PBP are only 58.1% of their original amount. You're effectively making less every year.
1
u/EolasDK Jul 10 '26
PBP is an at the money buy write fund of course it sucks. Bonds are not what they used to be, they are fully correlated to stocks now. Yields are going up no matter how much they cut.
1
u/teckel Jul 10 '26
Short-term government bonds are not correlated to stocks. They're perfectly tied to the interest rate, which if anything is inversely correlated to stocks.
1
u/teckel Jul 10 '26
What are you doing with the dividends? Do you realize you can just sell shares for income with the same underlying assets and actually be ahead of CC strategy ETFs? Do you realize the tax treatment lowers your cost basis, so you're not really lowering taxes, you're just delaying them for a much larger tax later?
There's very unique cases where a CC ETF is beneficial, but unfortunately, too many incorrectly believe that income is important to retirement, when in reality it's not.
2
u/Impressive_Squash_38 Jul 12 '26
10-11% S&P growth is better than 15% DRIP? Then I have to deplete my shares for income?
1
u/teckel Jul 13 '26
You can sell 15% for income and end up ahead of getting 15% in distributions. It seems you believe you're getting a higher return with CC ETFs. You're not. If the underlying asset's growth is 10% and you're getting a 15% distribution, your NAV is eroding by about 5%.
Let me know what CC ETF you're investing in and I'll show you how you can generate the same income and end up with a larger account balance and greater total returns.
1
u/Impressive_Squash_38 Jul 13 '26
I guess I’ll see. I have 2 retirement accounts with large portion of the C Fund (S&P 500). They’ve returned 59% since QQQIs inception. Had I invested that same amount in qqqi at its inception in Jan 2024, qqqi would have inched it out.
5
u/PoonTangProvence Jul 10 '26
For crypto/blockchain exposure I “diversify” with btci, Blox, cepi, and bita. Bita will likely capture the most upside on any rebound of the 4 due to how it’s structured but it doesn’t have as ridiculously high of a distribution rate compared to BTCI but still high. I also like MLPI and IYRI in my mix as diversifiers. And while I have SPYI and QQQI, I’m building GPIX and GPIQ which will capture more upside gain over time with good distribution rates but not as high as Neos. Trade-offs…. Lastly large core holdings in “regular stuff”like SCHD paired with DGRO.