The combination of a middling Process Pillar rating and a Below Average People Pillar rating limit  NEOS Enhanced Income Aggregate Bond ETF to a Morningstar Medalist Rating of Neutral.  The portfolio maintains a sizable cost advantage over competitors, priced within the least expensive fee quintile among peers.  

 The strategy's management team is about as experienced as others, but due to other weaknesses, the strategy earns a Below Average People Pillar. The strategy earns an Average Process Pillar rating.  The strategy's parent organization doesn't stand out, earning the firm an Average Parent Pillar rating. It has displayed a handful of investor-friendly attributes including modest portfolio manager turnover and overall reasonable fees.

Analyst Rating

Vanguard Total Bond Market ETF

iShares Core U.S. Aggregate Bond ETF

Morningstar's evaluation of this fund's process aims to determine how repeatable, consistent, and reliable it is, and whether management maintains a competitive advantage. Neos Enhanced Income Aggregate Bond ETF earns an Average Process Pillar rating.    The most substantial contributor to the rating is the firm's five-year retention rate of 100% over the period. Low expenses across its parent firm's funds, whose fees, on average, rank in the second-cheapest quintile of their respective category, also strengthen the process. The pattern of low costs at the firm indicates that it is focused on delivering strong results for investors. Lastly, the process is limited by the experience of the management team, which averages six years at this fund.

 Compared with other funds in the Multisector Bond Morningstar Category, this fund takes on significantly lower credit risk. But in terms of long-term interest-rate sensitivity, it hews closely to its average peer over the past few years. Opening the analysis to additional factors, the portfolio has displayed biases over time, whether towards or away from certain fixed-income instruments. Relative to the average strategy in the category, the managers have been meaningfully underweight corporate debt in recent years. In the latest month, the strategy has also relatively underweighted corporate debt compared with Morningstar Category peers. Additionally, there's been a notable overweight bias towards A rated bonds over the past few years. Compared with category peers, the strategy had more exposure to A rated bonds in the most recent month. Finally, during the past few years, the fund leaned meaningfully towards debt with one- to three-year maturities. In this month, the strategy also leaned more towards debt with one- to three-year maturities compared with its peers.

 This strategy's 12-month yield is 5.4%, which mirrors its average peer. It also has a 2.7% 30-day SEC yield (a measure similar to yield-to-maturity). The portfolio has a higher average surveyed credit quality of AA, compared with the category average of BB, and it holds no non-investment-grade assets, despite the average peers' 35%. Lower-credit-risk strategies are often able to navigate bear markets more effectively.

Average

Process

Neos Enhanced Income Aggregate Bond ETF earns a Below Average People Pillar rating. The team is supported by the firm's five-year retention rate of 100%. However, the rating is held back by the number of months that the management team has been running this vehicle together. Since this is a newly incepted product, more time is needed to monitor the team's capability at executing the strategy. Management team experience, which averages six years at this fund, also limits the team.


None of the portfolio managers here invest in this fund. This hurts the rating because manager investment would align their interests with the strategy's investors.

Below Average

People

Even though Neos Funds only has a one-year track record, it has shown to be an industry-standard steward, warranting an Average Parent Pillar rating. Neos Funds currently oversees six vehicles, with a total of $876.1 million under management and a roster of three portfolio managers.   

 Neos Funds deserves plaudits for its commitment to below-average fees for its open-end and exchange-traded funds, which showcases its willingness to prioritize investors. The firm's average net expense ratio across all funds is in the second-lowest quintile of firms.  

 To maintain an Average rating, Neos Funds needs to uphold a consistent track record of positive investor experience.

Parent

Neos Enhanced Income Aggregate Bond Etf

BNDI is an actively managed fund that invests in a diversified portfolio of fixed income securities with varying maturities and credit ratings while utilizing a US large-cap put-spread strategy.

Neos Enhanced Income Cash Alternative Etf

Neos Nasdaq-100 High Income ETF

Neos S&P 500 High Income Etf

Consumer spending beat expectations last month while consumer confidence fell slightly. The divergence is all part of a larger trend — a tale of two markets — that underscores the uncertainty investors face this year.

Enhance Your Tax-Efficient Income in Troubled Times

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The last two years benefited options-based strategies enormously as investors sought to boost their income in challenging markets. I recently sat down with Troy Cates, co-founder and managing partner at NEOS investments LLC, to talk about the firm's most recent fund launch and the mainstreaming of options-based strategies.

Troy Cates Talks Growth of Options-Based Strategies

WESTPORT, Conn.--(BUSINESS WIRE)--NEOS Investments, an asset management firm comprised of leaders and pioneers in the options-based ETF space, announces March monthly distribution amounts for their suite of ETFs that pursue monthly income and tax efficiency across core portfolio exposures. ETF distribution information as of the March 2024 Ex-Div Date (3/20/2024)   Distribution Yield* Amount / Share (%) Amount / Share ($) Distribution Frequency Expense Ratio Nasdaq-100 High Income ETF (QQQI) 14.

NEOS Investments Announces March ETF Suite Distributions

Markets remain frothy in the first quarter of 2024 as interest rate and economic uncertainty persist. Investors wanting to optimize the tax efficiency of their income this year should consider the suite of income ETFs from NEOS.

Boost Your Income Stream's Tax Efficiency With NEOS

The Nasdaq continued its ascent in trading this afternoon on further Nvidia gains. Investors wanting to optimize income shouldn't miss the distribution yield of one of the most recent Nasdaq ETFs launched.

The Nasdaq-100 ETF With 14% Distribution Yield

The year is already off to a turbulent start with a higher-than-expected January CPI print casting doubt on rate cut timing. With several macro risks looming over markets and investors, optimizing income taxes earned on core allocations could prove advantageous.

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A higher than anticipated January CPI print sent yields on the 10-year Treasury climbing Tuesday. The persistence and stickiness of inflation clouds the anticipated market narrative around rate cuts in the first half.

BNDI, the Bonds Income ETF Sleeper Hit

A traditional 60/40 stock/bond portfolio has been a tried and tested strategy among financial planners. But income seekers can specifically reap the benefits of both assets with exposure to one active exchange-traded fund: the NEOS Enhanced Income Aggregate Bond ETF (BNDI).

Get S&P and Bond Market Upside in One ETF

In the current macroeconomic environment, fixed income investors may be hanging on the Federal Reserve's every word. However, that doesn't have to be the case with an enhanced income option like the NEOS Enhanced Income Aggregate Bond ETF (BNDI).

Get Enhanced Income Despite What the Fed Does With Rates

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2022 and 2023 were hectic - war, bank crises, and bear markets.

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Aggregate bond benchmarks rebounded this year following some of the worst showings on record in 2022. With heightened expectations that the Federal Reserve could cut interest rates in 2024, fixed income enthusiasm is perking up.

Preparing for a New Fixed Income Environment in 2024

When the rate narrative changed in October, a veritable flood of money moved back into core bond exposures. As advisors and investors continue increasing their long-duration fixed income allocations, the NEOS Enhanced Income Aggregate Bond ETF (BNDI) is a fund to consider.

BNDI Offers Better Returns, Tax-Efficient Income in Bonds

The Neos Enhanced Income Aggregate Bond ETF seeks to distribute monthly income generated from investing in a representative portfolio of the U.S. Aggregate Bond Market. By implementing a data-driven put option strategy, the BNDI ETF aims to produce +2–2.5% in additional income per year while maintaining a similar risk profile to the underlying investments. As we head into 2024, the short-end of the (yield) curve should begin to normalize — positioning BNDI for success.

BNDI: 2024's Hidden Gem Bond ETF

Economic recession, side-stepping recession, rolling recession — there remains very little genuine consensus on what 2024 brings for the U.S. economy and markets. The high degree of uncertainty creates some challenges for advisors and investors alike.

Move Confidently Into 2024 With NEOS ETFs

‘Tis the season for tax-loss harvesting, and this year presents several opportunities in bonds. Advisors and investors needing to move into a product with similar exposure should consider the NEOS Enhanced Income Aggregate Bond ETF (BNDI).

When Tax-Loss Harvesting Bonds, Don't Overlook BNDI

The prospect of subsiding interest rates has become more pronounced after the recent pause in rate hikes by the Federal Reserve. If that's the case, fixed income investors may want to extract additional income while also getting core bond exposure with the NEOS Enhanced Income Aggregate Bond ETF (BNDI).

Get Additional Income & Core Bonds With BNDI

Hopes of a conclusion to Federal Reserve interest rate hikes sent bond prices soaring this week. Investors continue to increase their bond allocations in November, capturing yield opportunities as Fed rate risk falls.

Investors Buying Back Into Bonds Shouldn't Overlook BNDI

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It's been a great year for alternative income strategies as inflation, interest rate, and recession risk fears dominated markets. Garrett Paolella of NEOS and Christian Magoon of Amplify ETFs joined VettaFi's Tom Lydon to discuss alternative income opportunities at the Income Strategy Symposium hosted by VettaFi on October 27.

Income Opportunities in Bonds and Beyond

Analysts and economists currently forecast for increased economic slowing heading into next year. Optimizing income from core exposures through enhanced tax efficiency allows for the potential of greater returns capture in risky markets.

Make Your Income Count in Challenging Markets With NEOS

Advisors and investors face a number of challenges in an environment of rising rates and recession risk. Optimizing income across core exposures to meet the challenges ahead could prove advantageous.

Increase Tax-Efficient Income Across Core Exposures With NEOS

Following last year's calamity in the bond market, it's not surprising that advisors and investors are looking for new avenues through which to source income. That search is leading many market participants to options-based exchange traded funds, including covered call ETFs.

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The Fed may have held rates at this month's FOMC meeting but indicated the potential for one more hike before the year's end. Advisors and investors looking to optimize their bond exposures in a higher-for-longer rate environment should consider the  NEOS Enhanced Income Aggregate Bond ETF (BNDI).

Look to BNDI for Bond Exposures in a High Rate Environment

Confidence is returning to the bond markets and one sign is corporations' willingness to start taking on debt again with new issuance. While inflation is still high, the expectation is that the Federal Reserve will eventually lessen the pace of interest rate hikes.

Get Active Exposure as Corporate Confidence Returns in Bonds

Rising rates have taken their toll on bond prices this year, pushing yields ever higher. As the Fed rate hiking cycle eases in the latter part of the year, bonds look increasingly attractive.

Buying Back Into Bonds? BNDI Offers Better Returns

Market volatility and strong equity performance alongside noteworthy yields brought strong flows to the NEOS ETF suite in the last year. The ETFs offer high monthly, tax-efficient income within core allocations and celebrate their first anniversary from launch today, August 29.

News for Neos Enhanced Income Aggregate Bond Etf ETF (BNDI)