NUSI Stock: A Guide to the Nationwide Risk-Managed ETF
Introduction to NUSI Stock
In the world of income-generating investments, NUSI stock, formally known as the Nationwide Nasdaq-100 Risk-Managed Income ETF, has established itself as a prominent derivative-income vehicle. Designed for investors seeking exposure to the technology-heavy Nasdaq-100 index, it differentiates itself by employing a sophisticated options strategy to provide monthly income and a hedge against market volatility.
According to market data as of late 2024, the fund underwent a significant corporate restructuring. The management transitioned to NEOS Investments, resulting in a ticker symbol change from NUSI to QQQH (NEOS Nasdaq-100 Hedged Equity Income ETF). Despite this change, many investors still search for "NUSI stock" to understand its historical performance and its foundational "collar" strategy.
Investment Objective and Strategy
The core objective of the fund formerly known as NUSI stock is to generate high monthly income while maintaining lower volatility than the broader technology sector. To achieve this, the fund utilizes a "three-legged" options collar strategy:
- Equity Ownership: The fund holds the underlying stocks of the Nasdaq-100, providing exposure to growth.
- Selling Call Options: By selling (writing) call options, the fund generates immediate premium income, which is distributed to shareholders monthly.
- Buying Put Options: A portion of the income is used to purchase protective put options, which act as an insurance policy against significant market crashes.
This active management approach allows the fund to adapt strike prices based on prevailing market conditions, offering a more dynamic profile than passive covered-call ETFs.
Underlying Holdings
The equity component of NUSI stock mirrors the Nasdaq-100. This means investors get exposure to mega-cap technology leaders. According to recent filings, the primary holdings include:
- Apple (AAPL)
- Microsoft (MSFT)
- NVIDIA (NVDA)
- Amazon (AMZN)
Beyond the equities, the derivative component involves NDX index options. Unlike individual stock options, these index options are cash-settled and often provide better tax treatment under Section 1256 of the Internal Revenue Code.
Financial Performance and Dividends
One of the primary draws of NUSI stock is its distribution policy. Historically, the fund has targeted an annualized yield ranging from 7% to 9%, paid out on a monthly basis. This makes it an attractive option for retirees or income-focused portfolios.
In terms of total return, NUSI stock typically underperforms the standard QQQ (Nasdaq-100 ETF) during aggressive bull markets because the sold call options cap the upside potential. However, it is designed to outperform during sideways or moderately bearish markets where the income from premiums and the protection from puts mitigate losses. Its tax efficiency is often enhanced by classifying a portion of distributions as "Return of Capital" (ROC), which can defer tax liabilities for certain investors.
Risk Profile and Considerations
While NUSI stock provides a safety net, it is not without risks. Investors should consider the following:
- Upside Capping: In a massive tech rally, the fund will not participate in the full gain because the call options limit the ceiling.
- Downside Limits: The "put spread" strategy protects against major crashes (e.g., a 10% drop), but the fund can still experience small, incremental losses during minor market corrections.
- Expense Ratio: The fund carries a management fee of approximately 0.68%. While higher than a standard index fund, it is competitive with other active-income ETFs.
Corporate History and Rebranding
Launched on December 19, 2019, NUSI stock was originally part of the Nationwide ETF lineup. It gained significant popularity during the 2020-2021 market cycle as investors sought yield in a low-interest-rate environment. In November 2024, NEOS Investments acquired the predecessor fund’s assets. This led to the rebranding to QQQH, aiming to refine the options strategy and enhance liquidity for modern traders.
Comparison with Similar ETFs
When evaluating NUSI stock, it is often compared to other income-heavy Nasdaq vehicles:
- NUSI vs. QYLD: QYLD uses a pure "covered call" strategy, which offers high yield but no downside protection. NUSI stock (now QQH) includes the protective put, making it theoretically safer during crashes.
- NUSI vs. JEPI: While JEPI focuses on the S&P 500 and uses Equity Linked Notes (ELNs), NUSI stock is strictly focused on the volatility and growth of the Nasdaq-100.
Further Exploration into Market Strategies
Understanding NUSI stock is a gateway to learning about advanced financial instruments and hedging. For those interested in expanding their portfolio strategies into the digital asset space, exploring derivative-based income on platforms like Bitget can offer a modern parallel to traditional ETF strategies. By staying informed on how options impact market volatility, investors can better navigate both traditional equities and the evolving Web3 landscape.
