Animal Spirits Podcast Talk Your Book: The Psychology of Income
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Dec 1, 2025 Troy Cates, Co-founder and Managing Partner at NEOS Investments, delves into the world of options-based income ETFs and hedged equity strategies. He highlights the growing demand for yield among investors and explains how selling options can transform returns while managing risks. Troy also discusses the benefits of QQQH's hedged strategy, the advantages of index options, and the importance of tax efficiency. He even touches on innovative products like the Bitcoin income fund, showcasing the evolving landscape of investment strategies.
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Neos' Core Business And Scale
- Neos focuses on synthetic option ETFs that convert volatility into tax-efficient income.
- They run 13 ETFs with over $15 billion and more products in registration.
Trade Upside For Steady Income
- Options income transforms an asset's return profile by selling upside to create a steadier income stream.
- That reduces upside capture in strong bull markets while outperforming in flat or down markets by the income earned.
Younger Investors Buy Income, Not Just Retirees
- Demand for option-income ETFs now includes younger investors seeking early income or reinvestment.
- Investors use these products to diversify income sources beyond traditional fixed income.