SPYI pays a roughly 12% trailing yield, which is about 380 basis points above JEPI's 8%, and has delivered 19% total return over the past year.
NEOS, the fund family behind QQQI, structures SPYI using Section 1256 index options, taxing gains 60% long-term instead of as ordinary income.
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The JPMorgan Equity Premium Income ETF (NYSEARCA:JEPI) has become a default holding for income investors who want equity exposure with a fatter monthly check than the S&P 500 pays. JEPI writes out-of-the-money calls against a defensive slice of large-cap stocks and layers on equity-linked notes to juice the payout. That formula delivered $4.5713 per share in trailing distributions and a JEPI share price of $56.76, yielding roughly 8%. Solid, but a competing S&P 500 income ETF from the family behind QQQI is currently distributing at a materially higher rate on the same underlying index.
That fund is the NEOS S&P 500 High Income ETF (CBOE:SPYI), run by NEOS Investments. It targets the same job JEPI does, monthly income from large-cap US equities, but the mechanics under the hood differ in ways that matter for both yield and taxes.
The income fund's engine is a portfolio of ELNs written by counterparty banks. Those notes pass through the option premium, but their distributions are treated as ordinary income at the investor's marginal rate. For a household in the 32% or 35% federal bracket, that is a meaningful haircut on every monthly check. The fund's 0.35% expense ratio is low, and its top holdings, Broadcom at 1.8%, Ross Stores at 1.7%, and Amazon at 1.7%, look like a lower-beta version of the index. The tradeoff is a distribution stream that is both smaller and less tax-friendly than what a Section 1256 options strategy can produce.
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The income fund's total return has also lagged in 2026. Shares are up 3.31% year to date and 8.35% over the past year, which is a reminder that a defensive covered-call sleeve gives up upside in a strong market.
The index option fund writes call options on the S&P 500 index itself rather than on individual equities or through ELNs. Index options qualify as Section 1256 contracts under the tax code, which means gains and losses are treated as 60% long-term and 40% short-term regardless of holding period. A large share of the fund's monthly distributions is typically classified as a return of capital or a long-term capital gain, rather than ordinary income. For a taxable account, that shifts the after-tax yield closer to the headline rate.
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