MSTY vs. QQQI: Insane Dividends or High-Yield Stability?

<!– Legacy Bulma: `live-update-content` opening

Passive income seekers will be glad to know that you can use certain exchange traded funds (ETFs) to get higher yields than you would typically find with individual stocks. However, these high-yield ETFs can have quite different benefits and drawbacks, so you’ll definitely want to conduct your full due diligence.

Two high-yield funds with frequent payout schedules are the YieldMax MSTR Option Income Strategy ETF (NYSEARCA:MSTY) and the NEOS NASDAQ-100 High Income ETF (NASDAQ:QQQI). One of these ETFs offers a gigantic annual distribution yield while the other is more stable. Right now, we will weigh the wealth-building possibilities but also focus on the trade-offs so you can choose wisely.

MSTY: Massive Yield, Weekly Payouts

If you’re interested in cryptocurrency and specifically Bitcoin (CRYPTO:BTC), there’s a good chance that you’re familiar with Strategy (NASDAQ:MSTR). This company holds a large stockpile of Bitcoins, so if the Bitcoin price goes up, the MSTR share price might also rise.

However, Strategy stock doesn’t pay any cash dividends/distributions to its common shareholders. This may be disappointing to passive income investors, but there’s an interesting workaround in the world of ETFs.

While the YieldMax MSTR Option Income Strategy ETF holds positions in cash and U.S. Treasury bills, its most interesting feature is the fund’s positions in Strategy stock options. The MSTY ETF uses synthetic covered call strategies (or possibly synthetic covered call spread strategies) to indirectly derive substantial income from Strategy stock.

You don’t have to implement these sophisticated options-trading strategies yourself as the YieldMax MSTR Option Income Strategy ETF does this on your behalf. All you would have to do is own the MSTY ETF and then sit back and enjoy the weekly payouts to your account.

Not only would you see cash in your account every week, but the YieldMax MSTR Option Income Strategy ETF will also set you up with a supersized distribution yield. As of October 27, 2025, the MSTY ETF advertises a jaw-dropping annual distribution rate of 89.33%.

Limits on MSTY’s Share-Price Gains

That’s not the entire story, however. Sure, you could enjoy sizable weekly distributions with the YieldMax MSTR Option Income Strategy ETF, but there’s no guarantee that the fund’s yield will stay that high. Indeed, the MSTY ETF’s distribution rate could be reduced at any time.

Furthermore, there are factors that could limit the share-price gains of the YieldMax MSTR Option Income Strategy ETF. For one thing, the MSTY ETF deducts annualized operating expenses amounting to 0.99% of the fund’s share price.

Also, the options-trading strategies that enable the YieldMax MSTR Option Income Strategy ETF’s big weekly payouts can also weigh on your portfolio’s bottom line. The MSTY ETF may use covered call option trading strategies to generate income, and this will likely limit the fund’s share price-upside potential even if Strategy stock catapults higher.

Over the past 12 months as of October 27, 2025, Bitcoin gained significant value and MSTR stock rose 23%. In contrast, the YieldMax MSTR Option Income Strategy ETF’s share price fell 58% during that time. Thus, you might end up sacrificing share-price stability as the MSTY ETF isn’t widely diversified and uses income-generating strategies that involve significant risks.

QQQI: Broad Tech-Sector Exposure

At first glance, the NEOS NASDAQ-100 High Income ETF might seem inferior to the YieldMax MSTR Option Income Strategy ETF. First of all, the QQQI ETF pays monthly distributions, which are less frequent than MSTY’s weekly distributions.

Next, as of October 27, 2025, the NEOS NASDAQ-100 High Income ETF advertised a 14.28% annualized distribution rate. This is higher than what many stocks and ETFs offer, but it’s far below the distribution yield of the YieldMax MSTR Option Income Strategy ETF.

Moreover, the NEOS NASDAQ-100 High Income ETF uses covered call option trading strategies that are similar to MSTY’s income-generating strategies. Therefore, QQQI’s share-price upside potential will be limited in some scenarios.

Don’t give up on the NEOS NASDAQ-100 High Income ETF yet, though. As we’ll discover in a moment, the QQQI ETF has a number of advantages over the YieldMax MSTR Option Income Strategy ETF.

QQQI’s Diversification Can Bring Stability

To start off, the NEOS NASDAQ-100 High Income ETF deducts 0.68% worth of annualized operating expenses. This compares favorably to the 0.99% that the MSTY ETF deducts.

Second, the NEOS NASDAQ-100 High Income ETF is much more diversified than the single-stock-focused MSTY ETF. Centered around the technology-heavy NASDAQ 100 index, QQQI provides exposure to approximately 100 stocks; some examples include Apple (NASDAQ:AAPL), NVIDIA (NASDAQ:NVDA), Amazon (NASDAQ:AMZN), Meta Platforms (NASDAQ:META), and Broadcom (NASDAQ:AVGO).

Diversification can, in many instances, bring more stable outcomes. As we mentioned, the YieldMax MSTR Option Income Strategy ETF’s share price declined 58% in a one-year period. During that same time frame,  the NEOS NASDAQ-100 High Income ETF’s share price rose 7%.

Now, we can start to see the comparative trade-off between huge, frequent cash distributions and the risk of share-price erosion. If stability is a priority (which it really ought to be), the NEOS NASDAQ-100 High Income ETF looks like a better pick for the long term.

Besides, the QQQI ETF’s 14.28% distribution rate is still very high. At the end of the day, we shouldn’t let the unusually large yield of the NEOS NASDAQ-100 High Income ETF distort our sense of perspective.

It’s still fine for Bitcoin and Strategy stock enthusiasts to consider buying a few shares of the YieldMax MSTR Option Income Strategy ETF. For a larger share position, however, the NEOS NASDAQ-100 High Income ETF appears to offer a more favorable balance of high yield and relative price stability.

The image featured for this article is © Ground Picture / Shutterstock.com