3 Elite ETFs for Compound-Focused Investors

For investors focused on building long-term, compound returns, the strategy has shifted in recent years. Whilst buying a high-quality S&P 500 ETF still remains a Buffett-approved approach, several new options have recently become available for compound-focused investors. 

Investors can now capture high-yield income through sophisticated option-overlay ETFs. These funds keep their usual index stock exposure but sell options (often call options) on that index to collect premium income, which is then paid out as frequent distributions. These distributions often far exceed traditional dividends, turning the volatility of the S&P 500 and the Nasdaq-100 into a somewhat predictable cash flow engine. By reinvesting these yields, an investor can accelerate their share count growth regardless of whether the broader market is moving sideways or upward.

Let’s delve into three popular ETFs that aim to deliver aggressive returns to their shareholders.

SPYI: Core Market Exposure With a Tax-Efficient Twist

The NEOS S&P 500 High Income ETF (BATS: SPYI) is especially relevant for those seeking a balance between the stability of the S&P 500 and high-octane income.

As of mid-January 2026, SPYI is trading near $53 with an exceptional dividend yield of 11.61%. The fund manages $7.1 billion in assets, and distinguishes itself through a rules-based approach that uses SPX Index options.

This strategy is particularly insightful for tax-conscious investors because index options are classified under Section 1256 contracts, which typically qualify for a 60/40 blend of long-term and short-term capital gains treatment.

This tax efficiency makes SPYI a more durable choice for non-retirement accounts than standard covered-call funds, which may generate higher tax liabilities.

And no surprises in terms of its top holdings, which closely mirror the S&P 500. Mega-cap technology giants like NVIDIA, Apple, Microsoft, and Alphabet account for almost 20% of its holdings.

QQQI: Capturing Tech Growth and Double-Digit Yields

Now, for those willing to lean into the technology sector’s momentum and heightened volatility, the NEOS Nasdaq-100 High Income ETF (NASDAQ: QQQI) offers an even more aggressive yield profile.

The QQQI ETF has a whopping 13.71% yield, paying out an annual dividend of $7.44.

How is that possible? The fund utilizes a data-driven strategy to sell out-of-the-money call options on the Nasdaq 100.

This approach allows investors to participate in a portion of the tech sector's upside while simultaneously banking a monthly distribution that can be used to purchase more shares.

Yes, the upside is capped, but the income is real. The fund was only launched in 2024, but over the past 12 months, it has gained popularity.

It trades an average of 4.45 million shares daily, and over the last twelve months, institutions have purchased over $16 million worth of the ETF, versus just $1.48 million in outflows. 

JEPQ: Institutional Precision in the Nasdaq Space

The JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ: JEPQ) is one of the largest and most popular income ETFs, with $33.3 billion assets under management (AUM). It represents the institutional standard for the equity-income category. Its dividend yield of 10.42% is impressive, along with a relatively low net expense ratio of 0.35%.

Unlike the two NEOS funds discussed above, which use a more rigid rules-based option strategy, JEPQ utilizes active management and Equity Linked Notes (ELNs) to generate income.

That strategy allows JPMorgan portfolio managers to exercise discretion, potentially avoiding yield traps that can arise during rapid market shifts.

For the compound-focused investor, JEPQ offers institutional security and scale, ensuring the income engine remains operational even during periods of extreme market stress. Technology names dominate the ETF's holdings, with 39% exposure to the tech sector.

This is largely due to the monstrous market valuation of its top seven holdings, which are, of course, the Magnificent Seven.

Bottom Line: High Income, Real Tradeoffs

Option-overlay ETFs like SPYI, QQQI, and JEPQ can be powerful tools for investors who prioritize monthly income and reinvestment-driven compounding, but they come with real tradeoffs—especially capped upside in strong rallies and distributions that can vary with volatility. The best fit depends on your risk tolerance, tax situation, and whether you’re optimizing for steady cash flow or maximum long-term total return.

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