I started investing in IWMI on 30 January 2026 as part of my plan to generate more income from my investment portfolio.
IWMI, the NEOS Russell 2000 High Income ETF, invests in US small-cap stocks and uses options to generate monthly distributions.
Between January and October 2026, I invested over USD 13,000 in IWMI. The fund paid me almost USD 1,000 in gross distributions during that time.
But did I actually make money?
As of 14 October 2026, my IWMI investment was up USD 192.08, or 1.43%, after accounting for distributions and US withholding tax.
Not a particularly exciting return, but at least the distributions were enough to cover the decline in my share price.
Here’s how the numbers worked out.
What Is IWMI?
IWMI is a US-listed ETF managed by NEOS. It invests in companies from the Russell 2000 Index, which tracks approximately 2,000 smaller US companies.
Unlike a regular index ETF, IWMI also trades call options to generate income. This helps it pay monthly distributions.
The downside is that the options strategy can limit some of the gains when the market rises strongly. And if small-cap stocks fall, IWMI can lose value too.
| Fund information | IWMI |
|---|---|
| Full name | NEOS Russell 2000 High Income ETF |
| Underlying exposure | US small-cap stocks |
| Strategy | Russell 2000 exposure with call options |
| Distribution frequency | Monthly |
| Fund domicile | United States |
| Expense ratio | 0.76% gross; 0.68% net expense cap at the time of review |
How Much I’ve Invested in IWMI
I made my first IWMI purchase on 30 January 2026 and gradually built my position through recurring investments.
Most of my purchases were around USD 200 per trading day between January and April 2026. I also made a larger one-off purchase in July and reinvested two distributions.
Here’s how much I invested each month.
| Month | Amount invested (USD) |
|---|---|
| January 2026 | $200.38 |
| February 2026 | $3,827.22 |
| March 2026 | $4,207.99 |
| April 2026 | $2,404.57 |
| July 2026 | $2,778.09 |
| Total | $13,418.24 |
By 14 October 2026, I owned 268.1016 IWMI shares, with an average purchase price of approximately USD 50.05.
At a market price of USD 48.16 per share, my investment was worth USD 12,911.77.
That meant I was sitting on an unrealised loss of USD 506.47.
Fortunately, IWMI had also been paying monthly distributions.
How Much Income Did I Receive From IWMI?
Between February and September 2026, I received USD 997.93 in gross distributions from IWMI.
However, because I’m investing from Singapore, my broker withheld 30% US tax on those payments.
| Distribution details | Amount (USD) |
|---|---|
| Gross distributions | $997.93 |
| US withholding tax | -$299.38 |
| Distributions after tax | $698.55 |
So although IWMI paid almost USD 1,000, I received approximately USD 699 after tax.
Have the monthly distributions been stable?
One encouraging thing about IWMI was that its distributions stayed relatively consistent during the period I held it.
| Month | Distribution per share (USD) |
|---|---|
| February 2026 | $0.6018 |
| March 2026 | $0.5710 |
| April 2026 | $0.6120 |
| May 2026 | $0.6046 |
| June 2026 | $0.6277 |
| July 2026 | $0.6250 |
| August 2026 | $0.6373 |
| September 2026 | $0.6075 |
The monthly payouts ranged from approximately USD 0.57 to USD 0.64 per share.
That’s a fairly narrow range compared with some of my other income ETFs. However, these are historical payments, and there is no guarantee IWMI will maintain them.
My Actual IWMI Investment Return
This is the most important part of the review.
As of 14 October 2026, here’s how my IWMI investment had performed.
| My IWMI investment | Amount (USD) |
|---|---|
| Total amount spent buying shares | $13,418.24 |
| Market value on 14 October 2026 | $12,911.77 |
| Unrealised price loss | -$506.47 |
| Distributions received before tax | +$997.93 |
| Return before tax | +$491.46 |
| US withholding tax | -$299.38 |
| Overall return after tax | +$192.08 |
| Return after tax (%) | +1.43% |
Although my shares had lost USD 506.47 in value, the distributions more than covered that decline.
After tax, I was still ahead by USD 192.08.
That’s quite different from my experience with BTCI, where the distributions weren’t enough to offset the decline in share price.
But IWMI wasn’t exactly delivering spectacular returns either.
A 1.43% gain over roughly eight and a half months is relatively modest, especially considering the risks of investing in small-cap stocks.
What Are the Risks of Investing in IWMI?
IWMI provides exposure to smaller US companies, which can experience large price swings.
During the period I held the fund, there were times when its share price fell significantly.
My analysis found that IWMI’s share price declined approximately 10.5% between its February and March 2026 price peak and trough.
The monthly distributions helped soften the impact, but they didn’t prevent the decline.
There’s also a trade-off when the market rises. Because IWMI sells call options to generate income, it may not benefit fully from a strong rally in small-cap stocks.
Another thing worth remembering is that a high distribution rate doesn’t mean the fund is generating an equally high investment return.
As of 30 September 2026, IWMI’s reported distribution rate was 14.60%. Yet my personal after-tax investment return through 14 October was only 1.43%.
Those two figures measure different things. The distribution rate describes the fund’s cash payments relative to its value, while my return accounts for the money I received and the changes in my investment’s market value.
For me, the second figure is much more useful when deciding whether an investment is actually working.
Was IWMI Worth Investing In?
Looking at my results through 14 October 2026, IWMI had delivered a small positive return.
I invested USD 13,418.24, received USD 698.55 in after-tax distributions, and ended up with an investment gain of USD 192.08 after accounting for the decline in share price.
The monthly distributions had been fairly consistent, which is useful when I’m trying to build an investment portfolio that generates regular income.
However, I don’t want to judge IWMI by the amount it pays me every month alone.
My bigger goal is to generate investment income without slowly reducing the value of my portfolio.
So far, IWMI has managed to produce a small positive return, but that doesn’t mean future results will be the same.
I’ll continue looking at both the distributions and the market value of my holdings.
After all, receiving income is nice, but keeping my investment capital intact matters just as much.
Disclaimer: This article reflects my personal investment experience as of 14 October 2026 and is not financial or tax advice. Investments and options strategies involve risks, including capital losses. Distributions are not guaranteed.
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