SPYI review: monthly income from the S&P 500, yield and total return

SPYI at a glance

Dividend yield

12.04%

Total return since launch

+78%

Average per year

+15.2%

Expense ratio

0.68%

Fund size

$11.7 billion

Pays dividends

monthly

Numbers from the TopDividendETFsPRO database, updated September 26, 2026. Total return includes reinvested distributions. "Average per year" is the annualized version of that total return.

The NEOS S&P 500 High Income ETF, ticker SPYI, launched on August 29, 2022, during a rough year for stocks, and has since grown to about $11.7 billion. It was NEOS's first high-income ETF, and the same approach was later applied to the Nasdaq-100 in QQQI.

If you want monthly income from the broad U.S. market rather than a tech-heavy index, SPYI is usually the fund people look at first. Here's how it works, what it holds, how it's taxed, and what it could actually pay you.

How SPYI works

SPYI's goal, in NEOS's words, is to seek "high monthly income in a tax efficient manner, with the potential for upside appreciation in rising markets." It gets there in two layers.

A portfolio of S&P 500 stocks. SPYI invests in the companies that make up the S&P 500, so the core of the fund moves with the broad U.S. stock market.

An options overlay on the S&P 500 index. The fund sells call options on the S&P 500 Index (ticker SPX) to collect premiums, which fund the monthly distributions. It may also buy SPX calls at higher strike prices. That combination, often called a call spread, lets the fund keep some of the market's upside in a strong rally instead of giving it all away, which is the main weakness of a traditional covered call fund.

NEOS describes the approach as "data-driven" and actively managed. The managers adjust how much of the portfolio is covered and where the strikes sit, so the balance between income and upside can shift from month to month.

What's inside SPYI

Since SPYI holds the S&P 500, its largest positions look a lot like any S&P 500 fund. Its top five holdings in late September 2026:

The S&P 500 is still top-heavy, but it's much broader than the Nasdaq-100. Beyond tech, SPYI also owns banks, health care, energy, industrials, consumer staples and utilities. That diversification is the main reason some income investors prefer SPYI over QQQI: the income is a bit lower, but the stock portfolio underneath is less concentrated.

SPYI's yield and monthly payouts

SPYI's dividend yield is currently 12.04% in our database. NEOS reported a distribution rate of 12.15% as of August 31, 2026. The fund pays monthly.

The 30-day SEC yield on the fund page was just 0.46% on that date. As with other options-income funds, that gap is normal. The SEC yield counts only the ordinary dividends from the stocks, minus the fund's 0.68% expense ratio. The option premiums that pay most of SPYI's distributions aren't included in it.

Monthly payouts are not fixed. They depend on how much the options bring in, and option prices rise when markets are volatile and fall when things are calm. Price decay, where a fund's share price keeps sliding over time to fund its payouts, is the main risk to watch with any high-yield fund. Our database currently marks SPYI's price decay as none.

SPYI's total return

Since August 2022, SPYI has returned +78% with distributions reinvested, about +15.2% a year on average.

That record now covers roughly four years, including the end of the 2022 bear market and the strong recovery after it. It's the longest history of any NEOS high-income fund, which makes SPYI a useful reference point for how this style of strategy behaves across different markets.

Remember what total return is measuring here. It is what an investor would have earned if they had reinvested every distribution. If you spend the monthly income instead, your account value will grow more slowly than that number, which is expected and fine if income is the goal.

How SPYI is taxed

General information only, not tax advice.

Section 1256 index options

SPYI uses options on the SPX index, which are Section 1256 contracts. Gains and losses on those options are taxed 60% as long-term and 40% as short-term capital gains, regardless of how long each option was held. For a fund that trades options every month, that is typically more favorable than having all option gains taxed as short-term. Funds that use options on ETFs, like options on SPY, don't get this treatment.

Return of capital

According to NEOS, SPYI's distributions "have been classified as a return of capital." Return of capital generally isn't taxed when you receive it. It reduces your cost basis, so you pay tax later, when you sell. The fund also uses tax loss harvesting to offset gains inside the portfolio.

The monthly Section 19(a) notices give estimates of where each distribution came from, and your year-end 1099-DIV has the final numbers. Tax deferral isn't the same as tax-free, and holding SPYI in an IRA makes most of this moot.

How much does $10,000 in SPYI pay?

At SPYI's current yield of 12.04%, $10,000 would pay approximately:

To reach $1,000 a month at today's yield, you'd need about $99,700 invested. That assumes the yield stays where it is, which it won't exactly.

SPYI vs QQQI vs SCHD

These three funds get compared constantly, but they are built for different jobs:

SPYI and QQQI pay much more today by selling some of the future upside. SCHD pays much less today but has historically grown its dividend over time. Keep in mind that each fund's total return covers a different time period, so they aren't directly comparable. Read our full SCHD guide and QQQI guide for the details.

Who SPYI fits, and the tradeoffs

SPYI tends to suit investors who want high monthly income from the broad U.S. market and are willing to trade away part of the upside for it.

• It will lag in big rallies. Even with purchased calls, selling options limits how much the fund can gain when the S&P 500 surges.
• It still falls in sell-offs. The option income softens losses slightly but doesn't protect you from a market decline.
• Income varies month to month. Payouts follow option prices, which follow market volatility.
• Higher cost than an index fund. Its 0.68% expense ratio pays for the active options management.

Sources

• NEOS Funds: SPYI fund page (objective, strategy, holdings, distribution rate, SEC yield, expense ratio, 19(a) notices)
• IRS Publication 550 (Section 1256 contracts and return of capital)
• Live yield, total return, fund size and expense ratio: TopDividendETFsPRO.com database

This article is for education only and is not investment, tax or legal advice. Distributions are not guaranteed and can change or stop. Past performance does not guarantee future results. Read the fund's prospectus and talk with a tax professional before investing.