Episode summary
Q1 ETF Flow Trends & Next Evolution Options Strategies (NEOS)
ETF Prime
· · Hosts: Nate Geraci, Simeon Hyman · Guests: Cinthia Murphy, Troy Cates
Summary
ETF flows hit a record in the first quarter of 2026 even as major stock indexes fell, with total industry inflows above $460 billion. The host and a guest said the message from the data was not panic, but a continued preference for ETFs as a vehicle to navigate volatility. March was weaker than January and February, and the mix shifted toward defense: fixed income took about 45% of March flows, with money market and ultra-short bond ETFs drawing the most interest as investors reacted to geopolitical risk, sticky inflation concerns, and rising volatility.
On the equity side, the guest pointed to a more diversified flow picture than in recent years. SPYM overtook VOO at the top of the quarterly leaderboard on the back of low fees and retail adoption, while international ETFs like IEMG and VXUS, plus equal-weight and developed-markets funds, showed that diversification was finally resonating. Gold and energy also stood out as tactical havens, with gold seeing strong longer-term interest despite March outflows and energy ETFs attracting record March inflows.
The second half of the show focused on NEOS Investments, which has grown from three ETFs in 2022 to 19 funds and over $22 billion in assets. The guest argued that options-based ETFs can package institutional-style income strategies for ordinary investors, and highlighted products tied to the Nasdaq 100, S&P 500, Bitcoin, gold, short-term T-bills, and energy infrastructure. He emphasized that investors should look beyond headline yields and evaluate total return, volatility, and tax treatment.
Key takeaways
- The guest said first-quarter ETF inflows topped $460 billion, a roughly 50% increase from Q1 2025, even with weaker market performance.
- March flows shifted toward cash-like and short-duration fixed income, which the guest said accounted for about 45% of total March ETF inflows.
- SPYM beat VOO in quarterly inflows because its two-basis-point fee helped it win retail and benchmark-minded flows, the guest said.
- The guest argued that international equities, equal-weight stocks, gold, and energy all reflected a broader diversification trade rather than a single-theme market.
- NEOS said its options-based ETFs aim to deliver monthly income with rules-based exposure, but investors should compare total return, volatility, and tax efficiency rather than distribution yield.
Notable quotes
“overall total flows for the first quarter exceeded like $460 billion, which if you compare to first quarter 2025, that's about a 50% year-on-year increase for the quarter”
“March was a huge month for fixed income. And not just any kind of fixed income. It was back to the cashlike safety of money market funds, ultrashort bond funds”
“really as you're comparing maybe to making a NASDAQ 100 products or 10 NASDAQ 100 products, look at the total return. Look at the overall volatility”
How the episode opens
I think in March uh we did see the overall number decelerate. Uh when I went back and look at 2025, I'm like is this a normal thing for March or is it an unusual March? Last year we saw the same thing.
All right, joining me will be Troy Kates, co-founder and managing partner of Neos Investments, who has quietly become one of the fastest growing ETF issuers out there. This is a firm who launched its first ETF in August of 2022. And in less than four years, they've already grown to over 22 billion in assets.
$22 billion across 19 ETFs. And I would say they've really hung their hat on optionsbased income strategies, which of course that's been an excellent spot to be in uh ETF land, but NEOS has definitely capitalized on that. And so Troy and I are going to discuss that growth and some of the big drivers here.
And then we'll do a little tour through their ETF lineup. I've picked out several ETFs that I want to get us take on, including the Neos Bitcoin high income ETF, ticker BTCI, which I know that won't surprise anyone, and then the NEOS gold highinccome ETF, ticker AUI, which that actually just won an award for best new options income ETF. So, we'll look at those and we'll also get into uh due diligence and education around options-based ETFs overall.
Now, to start this week, I'll be joined by Cynthia Murphy, investment strategist at Vetify. And as we like to do from time to time, we're going to look at the latest ETF flow data, which it's perfect timing given that we just wrapped up the first quarter of 2026. And as always, there's some interesting stories to be found in that data.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- q1 etf flows
- options-based etf strategies
- next evolution options strategies
- etf lineup growth
- investor considerations
Companies and tickers mentioned
- VettaFi
- NEOS Investments
Watch the episode
Watch “Q1 ETF Flow Trends & Next Evolution Options Strategies (NEOS)” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
More from ETF Prime
-
Inside the Latest iShares ETF Trends with BlackRock’s Jay Jacobs -
Anthropic IPO & Bitcoin DRIP ETFs -
Baird Strategas’ Todd Sohn on ETFs: What’s New and What’s Next -
The AI Trade: Opportunity, Risk & What Comes Next -
SEC’s Brian Daly Provides an Update on Novel ETFs -
The ETF Stories to Watch for the Rest of 2026
ETF Prime, this episode and its artwork belong to Nate Geraci. Octagon is not affiliated with the show; this page is an independent summary.
