ETF Comparison

IWM vs IWMI: Which Is the Better Pick in 2026?

A head-to-head comparison of iShares Russell 2000 ETF and NEOS Russell 2000 High Income ETF covering yield, cost, risk, and income potential.

Data updated August 19, 2026

Best for

IWMInvestors who want broad equity exposure.
IWMIInvestors who want to maximize current income — roughly 14.39%, generated by selling options premium.

Jump to the side-by-side numbers

Visual comparison

Key metrics

Projected income on $10K

Projections assume the current yield and share price remain constant. Actual results will vary.

Total returns

IWM has outpaced IWMI over the trailing twelve months, posting a 33.73% total return against 28.74%. Measured from Jun 2024 — when the younger fund began trading — IWM has compounded at 22.15% a year versus 18.60% for IWMI. IWMI has been the steadier holding, though — annualized volatility of 15.1% against 19.0% for IWM. Figures are total returns: price change plus every distribution reinvested.

Total return and risk statistics by fund. Each row is one fund; each column is one period or statistic.
Symbol	YTD	1Y	Since Jun 2024	Volatility	Sharpe	Sortino	Max drawdown
IWM	21.78%	33.73%	22.15%	19.0%	1.29	1.95	-11.0%
IWMI	16.79%	28.74%	18.60%	15.1%	1.38	2.07	-8.4%

Total return with all distributions reinvested on the ex-dividend date, split-adjusted, as of August 19, 2026. YTD and 1Y are cumulative; longer windows are annualized. “Since Jun 2024” measures every fund from June 25, 2024 — the youngest fund's first trading day — so all funds share one comparison window. Volatility is the annualized standard deviation of daily total returns over the past year. Sharpe and Sortino divide the annualized return in excess of the risk-free rate by, respectively, that volatility and the downside deviation (both over the past year) — higher is better. Max drawdown is the largest peak-to-trough total-return decline over the same window — shallower is better.

Side-by-side snapshot

Side-by-side snapshot. Each row is one metric; each column is one fund.
Metric	IWM	IWMI
Full name	iShares Russell 2000 ETF	NEOS Russell 2000 High Income ETF
Issuer	iShares	NEOS
Last Close	$300.23 as of August 19, 2026	$53.15 as of August 19, 2026
Distribution yield	0.93%	14.39%
Distribution Safety Score™	95	84
Expense ratio	0.19%	0.68%
AUM	$83.3B	$1.20B
Distribution frequency	Quarterly	Monthly
Underlying index	Russell 2000 Index	Russell 2000 Index
Objective	Provide exposure to the fund's underlying index or strategy per issuer materials.	IWMI is built to crank out high monthly income while staying tax-efficient. The fund invests in Russell 2000 stocks and layers on a data-driven call option strategy. That combo gives it steady cash flow and a chance to grab some upside if the Russell 2000 rallies. For tax perks, it uses section 1256 index options (with the sweet 60/40 long-term vs short-term split) and fund managers may also harvest losses to soften the tax bite. Quick summary: * Goal: High monthly income + equity growth potential * Method: Russell 2000 holdings + call option overlay * Upside: Participates when RUT rises * Tax angle: 60/40 capital gains treatment + loss harvesting
Asset class	Equity	Equity
Inception date	05/22/2000	06/24/2024
Beta	1.26	1.0582
Last dividend	$0.6950	$0.6373
Ex-dividend date	06/15/2026	08/19/2026

Bottom lineChoose IWM if you want broad equity exposure. Choose IWMI if you want to maximize current income — roughly 14.39%, generated by selling options premium. There's no free lunch: IWMI's payout comes from selling options, which caps upside and can erode the share price over time, while IWM keeps full price exposure.

How the risk works

Read this before the income numbers below: the strategy mechanics on this page shape what those payouts can cost you.

Capped upside and premium dependence. IWMI generates income by selling options, which trades away part of a strong rally in exchange for premium. Distributions can include return of capital, and a payout the underlying assets cannot sustain shows up as NAV erosion over time — the big yield number is not free.

Learn the mechanics: Return of capital, explained · NAV erosion, explained

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Income calculator

See how much monthly income a hypothetical investment would generate in each ETF at current yields.

iShares

ETFs473

Total AUM$4710B

ETFs and AUM reflect what Dividend Vision tracks — the issuer's full lineup may be larger.

iShares is one of the largest ETF providers globally, known for offering a broad, diversified lineup of exchange-traded funds across multiple asset classes and investment strategies. The company operates 215 funds spanning 15 distinct families, including popular offerings in dividend income, covered call strategies, bonds, equities, ESG-focused investments, and factor-based approaches, with widely-held tickers like AGG (bond), ACWI (global equity), and AOA (allocation). iShares is characterized by its comprehensive fund ecosystem that serves both core portfolio holdings and specialized investment strategies, making it a prominent player for investors seeking both traditional and alternative income-generating ETF solutions.

See our curated list of related YouTube videos on IWM.

See all iShares ETFs

NEOS

ETFs19

Total AUM$32.2B

ETFs and AUM reflect what Dividend Vision tracks — the issuer's full lineup may be larger.

NEOS is known for developing specialized income-focused ETFs that employ strategies like covered calls, hedging, and enhanced yields across various asset classes. The firm manages 19 funds organized into nine distinct families, including offerings in equity high income, fixed income enhancement, digital assets, and alternative strategies, with popular tickers like SPYI (S&P 500 covered call), QQQI (Nasdaq-100 covered call), and QQQH (Nasdaq-100 hedged equity income). NEOS distinguishes itself in the ETF landscape through its emphasis on income generation and downside protection strategies rather than traditional growth approaches.

See our curated list of related YouTube videos on IWMI.

See all NEOS ETFs

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Quick verdict

IWM (iShares Russell 2000 ETF) and IWMI (NEOS Russell 2000 High Income ETF) are both dividend ETFs, but they take different approaches.

IWMI offers the higher yield at 14.39% vs 0.93% for IWM. A higher yield means more current income per dollar invested, though it may come with different risk characteristics.

IWM is cheaper with an expense ratio of 0.19% compared to 0.68%.

IWM is the larger fund by assets ($83.3B), which generally means tighter spreads and better liquidity.

Who should choose each?

Choose IWM

iShares Russell 2000 ETF

Want broad equity exposure.
Want to keep costs low — a 0.19% expense ratio vs 0.68% for IWMI.

Choose IWMI

NEOS Russell 2000 High Income ETF

Want to maximize current income — IWMI distributes roughly 14.39% from selling options premium, vs 0.93% for IWM.
Are comfortable with an options-income strategy — a large payout in exchange for capped upside.
Prefer lower volatility — a beta of 1.1 vs 1.3 for IWM.

Not sure? Use the income calculator and snapshot above to weigh these trade-offs against your own goals.

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Deep dive

Yield & income

On a $10,000 investment, IWM would generate roughly $7.75/month, while IWMI would produce $119.92/month, at current distribution rates.

IWM yield0.93%

IWMI yield14.39%

Monthly diff on $10K$112.17

Cost & efficiency

Over 10 years on $10,000, IWM would cost approximately $190 in fees vs $680 for IWMI (simplified, not compounded). The $490.00 difference may be offset by yield or performance.

IWM ER0.19%

IWMI ER0.68%

Strategy & risk

IWM tracks Russell 2000 Index with an index approach, while IWMI tracks Russell 2000 Index with an options approach. Beta is 1.26 for IWM and 1.0582 for IWMI, making IWMI the less volatile of the two by this measure.

IWM beta1.26

IWMI beta1.0582

Fund details

IWM is managed by iShares (launched 05/22/2000) with $83.3B in assets. IWMI is managed by NEOS (launched 06/24/2024) with $1.20B in assets.

IWM AUM$83.3B

IWMI AUM$1.20B

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Frequently asked questions

What is the current distribution yield for IWM and IWMI?

IWM currently distributes 0.93% and IWMI 14.39%, based on fund data updated August 2026. Distribution yield moves with both the payout and the share price, so check the as-of date before relying on either figure.

Is IWM or IWMI better for dividend income?

It depends on your goals. IWMI currently offers the higher distribution yield, which means more income per dollar invested. However, a lower-yield fund may offer better total return or lower volatility. Consider your time horizon and risk tolerance.

What is the difference between IWM and IWMI?

IWM (iShares Russell 2000 ETF) tracks Russell 2000 Index with an index approach, while IWMI (NEOS Russell 2000 High Income ETF) tracks Russell 2000 Index with an options approach. They are issued by iShares and NEOS respectively.

Can I hold both IWM and IWMI?

Yes — nothing prevents holding both. Whether the combination actually diversifies depends on how much the underlying exposures overlap, which isn't fully measurable from the data on this page; review each security's holdings, sector, and strategy before treating them as complementary.

Is IWM or IWMI safer?

By Dividend Vision's Distribution Safety Score — a rules-based 0–100 estimate of how resilient a distribution looks, where higher is safer — IWM scores 95, IWMI scores 84, so IWM's payout currently looks the more resilient of the two. IWMI has also shown lower price volatility (beta 1.06 vs 1.26 for IWM). No score makes an investment risk-free — treat this as a screening signal, not a guarantee, and the leverage, options-income, or crypto caveats flagged on this page apply regardless of score.

Which has lower fees, IWM or IWMI?

IWM has an expense ratio of 0.19% while IWMI charges 0.68%. Lower fees mean more of your investment returns stay in your pocket over time.

How much income does $10,000 in IWM vs IWMI generate?

At current rates, $10,000 in IWM would generate roughly $7.75 per month ($93.00 annually). The same in IWMI would produce about $119.92 per month ($1,439.00 annually).

Which has performed better historically, IWM or IWMI?

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IWM vs IWMI — at a glance

Generated August 15, 2026.

Figures quoted in this analysis are from its generation date and may lag the live snapshot table above, which always shows the latest data.

Overview

IWM and IWMI both track the Russell 2000 Index of small-cap U.S. stocks, but they pursue fundamentally different return streams. IWM is a straightforward cap-weighted index fund that passes through the index's underlying dividend yield. IWMI layers a call option overlay on top of Russell 2000 holdings, selling upside to generate monthly distributions that run 13.98% annualized—a yield more than 15 times higher than IWM's 0.91%.

How they differ

The core difference is strategy: IWM replicates the Russell 2000 passively, while IWMI holds Russell 2000 stocks and systematically sells call options against them to harvest premium. That structural choice cascades into everything else. IWMI's 13.98% distribution rate comes from option premium, not underlying dividends, and it pays monthly instead of quarterly. The expense ratio gap—0.68% for IWMI versus 0.19% for IWM—reflects the cost of managing the options overlay and loss-harvesting mechanics. IWMI also operates at a much smaller scale ($1.16B in assets versus IWM's $82.2B), and it arrived in the market far more recently (June 2024 versus May 2000), meaning there is limited history to observe how it performs across a full market cycle.

Who each is best for

IWM: Fits investors seeking broad, low-friction exposure to small-cap equities with modest dividend reinvestment, without the complexity or tax mechanics of an options strategy.

IWMI: Designed for income-focused investors who want to trade away upside participation above the call strikes in exchange for steady monthly cash flow, and who value the potential tax efficiency of section 1256 option treatment and loss harvesting.

Key risks to know

NAV erosion at 13%+ yields. IWMI's 13.98% distribution rate is substantially higher than the Russell 2000's underlying dividend yield. If the fund's option premium income declines or if losses from written calls accumulate, the fund may rely on return-of-capital distributions, gradually eroding net asset value.

Call strike caps upside in rallies. Because IWMI sells calls to fund distributions, rallies beyond the strike prices leave it capped while IWM captures the full move. This headwind compounds over time in a sustained bull market.

Beta reduction and liquidity lag. IWMI's beta of 1.0582 versus IWM's 1.26 reflects the dampening effect of call sales. Its much smaller AUM ($1.16B) also means wider bid-ask spreads and less trading liquidity, a meaningful friction for large or frequent trades.

Newness and incomplete history. IWMI inception was in June 2024, offering no data through a full market cycle, a drawdown, or a volatility spike. Its actual option management performance under stress remains unproven.

Loss harvesting sustainability. Tax-loss harvesting can enhance after-tax returns, but relies on markets moving in ways that create losses to harvest. Persistent market strength could limit harvesting opportunities and leave distributions more reliant on option premium alone.

Bottom line

IWM offers transparent, low-cost small-cap exposure with minimal tax complexity and full upside participation. IWMI bets that monthly income from call sales and tax-efficient option treatment outweigh the friction of capped upside and higher fees. If you prioritize simplicity and full market participation, IWM's liquidity and cost structure stand out; if you value consistent monthly distributions and tax-loss harvesting mechanics, IWMI's higher yield may appeal—though its short track record means the real test of sustainability lies ahead. Past performance doesn't predict future results.

AI-generated analysis for educational purposes only. Verify important details independently; past performance does not guarantee future results.

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The metrics behind this comparison, explained in the Academy.

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