Income Investing Results

[HappilyRetired]

I got credited $3360 in dividends and interest today. $2145 of that tax free. The rest in an IRA. By Monday I’ll get another $39,618 with $22,887 of that tax free and the balance In an IRA.
The portfolio sits less than 1% below my all time high. Just chugging along.

excellent strategy CoCheesehead! love it

 

[HappilyRetired]

Have any of you invested in MSTY ? It is in the crypto space, and is part of MicroStrategy (MSTR) but invests in Treasury's and give over 100% yield!

MSTY - YIELDMAX MSTR OPTION INCOME STRATEGY ETF | ETF Quotes from Fidelity Investments (this is a list of its holdings)

Distributions are paid monthly, and they declare the ex-date two days before paying the distribution . In May it was $2.273 per share, in June it was $1.47, and in July on the 7th it is $1.2382. The cost of my shares were in the $21 dollar range... For 250 shares, I will be getting $3.05 on the 7th.... As you can see the dividend fluctuates, but man, what a yield. At this rate, I will have paid back my investment in 7 months, and everything from that point is gravy....

Not for the faint hearted, and probably only a play for a year or so, but while it is live, I am biting. Investing only $5k so far, and I think I will just hold there and collect dividends... Ask ChatGPT or GROK what they think!

 

[COcheesehead]

Have any of you invested in MSTY ? It is in the crypto space, and is part of MicroStrategy (MSTR) but invests in Treasury's and give over 100% yield!

MSTY - YIELDMAX MSTR OPTION INCOME STRATEGY ETF | ETF Quotes from Fidelity Investments (this is a list of its holdings)

Distributions are paid monthly, and they declare the ex-date two days before paying the distribution . In May it was $2.273 per share, in June it was $1.47, and in July on the 7th it is $1.2382. The cost of my shares were in the $21 dollar range... For 250 shares, I will be getting $3.05 on the 7th.... As you can see the dividend fluctuates, but man, what a yield. At this rate, I will have paid back my investment in 7 months, and everything from that point is gravy....

Not for the faint hearted, and probably only a play for a year or so, but while it is live, I am biting. Investing only $5k so far, and I think I will just hold there and collect dividends... Ask ChatGPT or GROK what they think!

I owned other Yieldmax products. They were the absolute worst investments I ever owned. I lost 40% of my original money invested. They pay a boatload of distributions, but…nav can be out of control.

Your results may vary.

 

[HappilyRetired]

Thanks for the heads up. I agree it is very risky. But tied to the US treasury bills. The share price is already down 50% from when it first launched. My buy price is $21.40 and just bought in last week. Seeking Alpha has some good articles and comments so check them out as well when anyone does their due diligence. Thanks for the heads up!

 

[Drifter]

I don't care for the yieldmax funds myself. I had CONY which just kept going backwards after dividend payouts. I have AMZY and will be selling it soon as well. I like SPYI better.

 

[Waynew]

COcheesehead: I am trying to move as much as I can from our T-IRAs into our ROTHs each year. Of course it is a taxable event. But how awesome is the ROTH!!!......no tax on dividends, capital gains, nothing , nada, zip, zilch...no tax...Currently we receive about $37k just in dividends from our ROTHs.. Totally non-taxable. This is so wonderful. But my RMD starts in 2 years so the window is closing...Today we get to deduct another $12k (joint return) on income....this helps as we aren't over the $150k limit in income because we have the ROTH to pay us so handsomely...it's all about tax strategy.......Have a Happy 4th!

I am just about done taking my 2025 RMD using QCD's. Then I will continue my ROTH conversion just like past years. I'm willing to pay the taxes now because some day I expect my wife will have to file as a single, and that will be an expensive tax if I don't reduce the size of my $2M T-IRA. Using this strategy my ROTH is now over $1M and I get free dividends of $55K and options income on top of that.

 

[COcheesehead]

Thanks for the heads up. I agree it is very risky. But tied to the US treasury bills. The share price is already down 50% from when it first launched. My buy price is $21.40 and just bought in last week. Seeking Alpha has some good articles and comments so check them out as well when anyone does their due diligence. Thanks for the heads up!

The treasuries are used as collateral. The NAV isn’t tied to them. Be careful.

 

[socca]

Total investment income through Q2 2025 was a little over $300k. This is what three major liquidity events in three years will do for you (a fourth and final liquidity event should happen later this year unless a pack of ravenous lawyers descends and gobbles it up). My overall yield is much lower than that reported by some folks on this thread. I don’t need higher yield (can’t spend all of the investment income I’m already receiving) and thus have no reason to take on additional risk. It’s too bad that adding zeroes to my bank account doesn’t add zeroes to the number of heartbeats left in my body .

 

[HappilyRetired]

Love your strategy Waynew. Even though I am not at RMD age yet, I can start my QCDs from my T-IRA, which I started this year. I plan on doing exactly what you have been doing, taking my QCDs and then move more over to my ROTH thereafter, each year. The dang T-IRA just keeps growing, and each dent seems so small in comparison! Not that I'm complaining....

I am just about done taking my 2025 RMD using QCD's. Then I will continue my ROTH conversion just like past years. I'm willing to pay the taxes now because some day I expect my wife will have to file as a single, and that will be an expensive tax if I don't reduce the size of my $2M T-IRA. Using this strategy my ROTH is now over $1M and I get free dividends of $55K and options income on top of that.

 

[SunGuy]

Been very happy with my growth/income/ETF split between my accounts. Funded my Roth this year by the end of February, so setting aside the weekly amount for next year, and adding extra to my house fund.

Have a good mix of MSTY and ULTY in my various accounts. Maybe 20% of total assets? 60/40 split. Bought them after the drop a few months ago.

Really hope to see a housing crash within the next few years, otherwise it is a never ending goal post as home prices where I have to buy keep going out of reach every six months.

The only people my age or younger I know with houses are all just spoiled rich kids, or people with 1% level pay jobs that lucked out with $100k+ jobs right out of school in medical/tech stuff.

 

[SageForesight]

Sold XOM bought SPYI in my income producing account. My capital gain in XOM was equal to 15 years worth of XOM dividends at current yield so time to trim. Sell some XOM and use the proceeds to buy SPYI which will yield 3X more dividends. My Fidelity Tax Managed SMA had some tax losses so I used them and wiped out the XOM capital gain and tripled my income.

 

[stefansm]

Does anyone know the ex date and amount of QLENX distribution? I'd like to start building a position but I know they distribute the full year income in one shot in December. And I don't want to buy before this happens.

 

[RobLJ]

Does anyone know the ex date and amount of QLENX distribution? I'd like to start building a position but I know they distribute the full year income in one shot in December. And I don't want to buy before this happens.

Dividend history is below so you can infer between 18th and 23rd of Dec.

AQR Long-Short Equity Fund Class N (QLENX) Dividends Dates And Yield - TipRanks.com

AQR Long-Short Equity Fund Class N (QLENX) Dividends Dates And Yield - See the dividend history dates, yield, and payout ratio for AQR Long-Short Equity Fund Class N

www.tipranks.com

 

[stefansm]

Dividend history is below so you can infer between 18th and 23rd of Dec.

AQR Long-Short Equity Fund Class N (QLENX) Dividends Dates And Yield - TipRanks.com

AQR Long-Short Equity Fund Class N (QLENX) Dividends Dates And Yield - See the dividend history dates, yield, and payout ratio for AQR Long-Short Equity Fund Class N

www.tipranks.com

Thank you. Yes, I can infer that it is sometime in December, but not more than that.

 

[COcheesehead]

Does anyone know the ex date and amount of QLENX distribution? I'd like to start building a position but I know they distribute the full year income in one shot in December. And I don't want to buy before this happens.

Buy afterward. Then there is no guess.

 

[Semi-Retyrd]

Does anyone know the ex date and amount of QLENX distribution? I'd like to start building a position but I know they distribute the full year income in one shot in December. And I don't want to buy before this happens.

The precise date of the distribution for 2025 for all of AQR funds was published earlier this year and is available on their website. See the attachment below and note the ex-dividend date is Wednesday Dec 17 2025.
A little before this date in December AQR will publish the final details of each fund distribution including total amount and portions of income and capital gains. I have attached the final distribution memo for 2024 to show you the format of this memo.

 

[Semi-Retyrd]

For those curious to know how much of the income distribution for 2024 were qualified dividends you need to go to an excel spreadsheet titled "AQR ICI Primary - 2024" on the AQR website. In the case of QLENX the total distribution for 2024 was about $1.11 and it was all income with no capital gains. Of the total income about $.31 were qualified dividends. I have no idea of the size or the makeup of QLENX's distribution for 2025. For tax efficiency the AQR folks will make it as small as legally possible given the structure of mutual funds.

 

[stefansm]

The precise date of the distribution for 2025 for all of AQR funds was published earlier this year and is available on their website. See the attachment below and note the ex-dividend date is Wednesday Dec 17 2025.
A little before this date in December AQR will publish the final details of each fund distribution including total amount and portions of income and capital gains. I have attached the final distribution memo for 2024 to show you the format of this memo.

Thank you so much! Valuable info.

 

[stefansm]

My portfolio is made of these asset classes, in order of increasing volatility:

Individual Munis (AAA-AA), IG Bonds Mutual Funds, Alternatives, Bondish CEFs, Equities and Bitcoin.
Most of the portfolio is in taxable accounts.
The Individual Munis sleeve, for me, is basically a "cash" alternative, with a 4% return on average.

The key to reducing portfolio volatility is to combine uncorrelated asset classes. During a recession all risk-on assets correlate to 1. During the 2022 stagflation, bonds and stocks were correlated and went down together.

The only asset class uncorrelated at all times with equities are managed futures.

The "Alternatives" is: BLNDX (a 50/50 combo of equity indices and managed futures, managed actively by Eric Crittenden, one of the best managers in this space), and managed futures: DBMF, ASMF and CTA. DBMF and ASMF are replicators of the SocGen Managed Futures Index while CTA is a proprietary managed futures fund.

The idea of using managed futures is based on their convex returns vs S&P 500. They are a great hedge in recessions and stagflations bear markets for stocks and risk on asset classes.

In the chart below, you can see the "Managed Futures Smile" convexity. S&P quarterly returns on X axis, Managed Futures Index (replicated by DBMF) on Y:

 

[COcheesehead]

My portfolio is made of these asset classes, in order of increasing volatility:

Individual Munis (AAA-AA), IG Bonds Mutual Funds, Alternatives, Bondish CEFs, Equities and Bitcoin.
Most of the portfolio is in taxable accounts.
The Individual Munis sleeve, for me, is basically a "cash" alternative, with a 4% return on average.

The key to reducing portfolio volatility is to combine uncorrelated asset classes. During a recession all risk-on assets correlate to 1. During the 2022 stagflation, bonds and stocks were correlated and went down together.

The only asset class uncorrelated at all times with equities are managed futures.

The "Alternatives" is: BLNDX (a 50/50 combo of equity indices and managed futures, managed actively by Eric Crittenden, one of the best managers in this space), and managed futures: DBMF, ASMF and CTA. DBMF and ASMF are replicators of the SocGen Managed Futures Index while CTA is a proprietary managed futures fund.

The idea of using managed futures is based on their convex returns vs S&P 500. They are a great hedge in recessions and stagflations bear markets for stocks and risk on asset classes.

In the chart below, you can see the "Managed Futures Smile" convexity. S&P quarterly returns on X axis, Managed Futures Index (replicated by DBMF) on Y:

View attachment 60140

Interesting. BLNDX shows only a .14% YTD gain. Can that be right?

 

[stefansm]

Interesting. BLNDX shows only a .14% YTD gain. Can that be right?

Yes, they had a bad year. But check out all the other years since 2020, especially the 2020 crash and the 2022 bear market for stocks.

 

[foxcreek9]

Yes, they had a bad year. But check out all the other years since 2020, especially the 2020 crash and the 2022 bear market for stocks.

Maybe I just don't understand, but unless you are the rare expert at timing the market or we go into a prolong 70s like slump, what is the benefit? Compared to SP500 and QQQ since 2020 and 2022. Looks like a lot of money left on the table.

 

[stefansm]

Maybe I just don't understand, but unless you are the rare expert at timing the market or we go into a prolong 70s like slump, what is the benefit? Compared to SP500 and QQQ since 2020 and 2022. Looks like a lot of money left on the table.

View attachment 60141View attachment 60142

OK, let me try to explain:
This is about portfolio management:
1) BLNDX strategy is based on combining Buy & Hold Equity Indices with a systematic managed futures strategy. These 2 asset classes have 0 correlation. In addition, as I showed above, managed futures protect in stock bear markets.
To simulate the BLNDX returns over a longer time frame, one could backtest a portfolio made of 50% S&P Index and 50% Managed Futures Index.

First, let me show you this simulation and next I will comment on it:

In the chart below, you can see S&P in red, Managed Futures in Green and the 50/50 blend in brown. I made the simulation rebalancing every week, starting in July 2000. You see that the 50/50 system works like a 2 pistons engine, when one is down the other is up and the result gives you close to S&P results BUT (and this is key) with a very low volatility, lower than any of S&P or the Managed Futures Index. This is the magic of combining uncorrelated asset classes.

You don't need to be a market timer, the combo of these 2 asset classes rebalanced periodically does protect you in bear markets while capturing most upside in bull markets:

 

[stefansm]

2) The most important problem for retirees investing in the stock market, and maybe depending on the stocks returns, is the so called sequence of returns. This means, your capital going forward, from the moment you retire, is highly dependent on the moment you chose to start your retirement.
Let me illustrate:

Here is a closeup of the chart above. Let's assume you retired in July 2000. What you see is that, from mid 2000 to Dec 2011, for about 11 years, your total return of buying and holding S&P 500 index would have been 0 (zero). While buy and hold managed futures would have returned 151%. And, the 50/50 S&P/Managed Futures portfolio would have captured, of course, half of it => 76% return, with lower volatility than S&P. You can see you would have gone through a very difficult set of huge S&P drawdowns -45% in 2000-2002 and -50% in 2008-2009. Very few investors in retirement would have been able to withstand these, especially if your retirement depended of that capital. So, in the 11 years in retirement, you would actually have lost a lot of capital, as you would be forced to liquidate and not been able to hold to it, and also had to sell part of the proceeds to live of. While the BLNDX style system would have had an annualized return of 5.5% / year over this very challenging 11 years period.

 

[stefansm]

3) Finally, about BLNDX, its benchmark, for me, is the 50/50 combo I showed above. You see that from 2020 inception, BLNDX (blue) was correlated but beat its benchmark every year. And did well in the 2022 bear market, while S&P had a -30% max drawdown. But in 2025, BLNDX lagged its benchmark. This is to be expected. They are still positive for the year and I think will do decently by the end of year: