High income focused portfolio with concentrated exposure to technology and North American markets
Report created on Aug 3, 2025Risk profile
5/7
Diversification profile
2/5
Positions
-
QQ NEOS Nasdaq 100 High Income ETF
QQQI - US78433H6751 100.00%
This portfolio is entirely allocated to the NEOS Nasdaq 100 High Income ETF, which provides concentrated exposure to large-cap technology stocks in North America. With 98% of assets in stocks and the remainder in cash, it reflects a growth-oriented risk profile but lacks diversification across asset classes and sectors. The heavy weighting towards technology (54%) and communication services (16%) sectors indicates a strong focus on high-growth areas of the market.
Growth
Historically, this portfolio has shown a Compound Annual Growth Rate (CAGR) of 18.67%, which is impressive. The maximum drawdown of -19.94% indicates the portfolio's volatility and potential risk during market downturns. A significant insight is that 90% of returns came from just 7 days, highlighting the importance of being invested during key market movements but also the risk of missing these days.
Projection
Monte Carlo simulations, based on historical data, suggest a wide range of outcomes for this portfolio. The 50th percentile outcome projects a 1,065.7% increase, while the 5th and 67th percentiles indicate variability in potential performance. This underscores the uncertainty inherent in investing, especially with a portfolio so heavily concentrated in specific sectors and regions.
Asset classes
- Stocks 98%
- Cash 2%
The portfolio's allocation is heavily skewed towards stocks, particularly in the technology sector, with minimal cash holdings. This allocation supports a growth-focused strategy but increases susceptibility to market volatility. Diversifying across more asset classes could mitigate some risk without necessarily compromising growth potential.
Sectors
- Technology 54%
- Telecommunications 16%
- Consumer Discretionary 13%
- Consumer Staples 5%
- Health Care 5%
- Industrials 3%
- Utilities 1%
- Basic Materials 1%
The sectoral allocation reveals a significant bet on technology and communication services, with consumer cyclicals also playing a notable role. While these sectors can offer high growth, they are also subject to higher volatility and sector-specific risks. Diversifying into more defensive sectors or those with lower correlation to the market could provide a buffer in volatile times.
Regions
- North America 98%
- Europe Developed 1%
- Latin America 1%
Geographic allocation is overwhelmingly focused on North America, with minimal exposure to developed Europe and Latin America. This concentration in a single region, while benefiting from the growth of the U.S. market, limits global diversification and exposure to potential growth in other regions.
Market capitalization
- Mega-cap 55%
- Large-cap 33%
- Mid-cap 11%
The portfolio's emphasis on mega and big cap stocks aligns with its growth and income objectives, leveraging the stability and potential high yield of large, established companies. However, the limited exposure to medium cap stocks could mean missing out on higher growth opportunities that these companies can offer.
Dividends
- NEOS Nasdaq 100 High Income ETF 14.20%
- Weighted yield (per year) 14.20%
The NEOS Nasdaq 100 High Income ETF's dividend yield of 14.20% is remarkable, contributing significantly to the portfolio's total return. This high yield is attractive for income-seeking investors but should be balanced with the understanding that high dividends can also reflect higher risk.
Ongoing product costs
- NEOS Nasdaq 100 High Income ETF 0.68%
- Weighted costs total (per year) 0.68%
With a total expense ratio (TER) of 0.68%, the portfolio's costs are within a reasonable range for a specialized ETF. However, investors should consider the impact of these costs on net returns over time, especially in a high-cost product focusing on a specific market segment.
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