DFAC vs NLSI

DFACADimensional US Core Equity 2 ETF

NLSIFNEOS Long/Short Equity Income ETF

In short

DFAC Dimensional's whole-market workhorse: roughly 2,600 US stocks in one ticker, run by managers who weigh federal tax consequences before they trade, at a fee closer to index funds than to active ones.

NLSI NEOS built its name selling S&P 500 options for income. NLSI straps that overlay onto an actively run long/short U.S. stock book and pays monthly. An income-first spin on a hedge-fund staple.

Stated mandate

DFAC The fund seeks long-term capital appreciation while considering federal income-tax implications in its investment decisions.

NLSI The Fund seeks high monthly income with potential equity appreciation. It uses an actively managed long/short U.S. equity strategy and an options overlay.

Why people hold it

• DFAC 0.17% a year for an actively run fund, well under the median fee among active US equity ETFs.
• About 2,600 US stocks under one ticker, so it holds the market broadly rather than a narrow slice of it.
• Federal income-tax implications sit inside the stated objective, not in a footnote, so they factor into what managers buy and sell.
• A multi-billion-dollar fund with a track record running back to 2007 and one of the strongest implementations in its peer group.

• NLSI Two engines under one ticker: an actively managed long/short U.S. equity portfolio, plus an SPX put-spread overlay written to generate monthly cash.neosfunds.com
• The overlay uses index options, which qualify as Section 1256 contracts: gains split 60% long-term and 40% short-term no matter how long they were held.neosfunds.comneosfunds.com 2
• Shorts sit beside longs by design, putting more weight on the manager's stock selection and less on the market's direction.neosfunds.com
• Distributions land monthly, and each one comes with a 19a-1 notice breaking out option premium, dividends, gains and return of capital.neosfunds.com

Worth knowing

• DFAC Actively managed, so there's no published index to check it against. Holdings and tilts shift at the managers' discretion.
• Dimensional's own DFAU runs a US core equity mandate for 0.12%, a slightly lighter fee for a similar shelf.
• All stocks, all US: the mandate is capital appreciation from equities, so it takes the market's full swings, and cash arrives quarterly.

• NLSI Total expenses run 2.89% a year, far above typical active U.S. equity ETFs. Much of it is dividend and interest cost on the short book, but it hits returns the same way.neosfunds.com
• Launched in December 2025, so a proprietary long/short model is running with very little public track record behind it, in a small fund next to its category's giants.
• Payouts have been classified as return of capital, which reduces your cost basis rather than adding to it. Useful for deferral, not the same thing as pure yield.neosfunds.com

Full DFAC profile⁠

Full NLSI profile⁠