Section 1256 Tax Risk Threatens QQQI's Core Yield Advantage
NEOS Investments' QQQI ETF derives its competitive edge from Section 1256 index options, which receive favorable 60/40 long-term/short-term capital gains tax treatment. Any IRS reclassification or Congressional action eliminating this treatment would directly undermine QQQI's after-tax yield advantage. The risk is rated low probability but catastrophic in severity if realized.
Salvado•