DFAU vs NLSI

DFAUADimensional US Core Equity Market ETF

NLSIFNEOS Long/Short Equity Income ETF

In short

DFAU Active management priced like an index fund. Dimensional spreads across roughly 2,400 US stocks, then tilts the weights toward value, profitability and momentum instead of simply mirroring the Russell 3000.

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

DFAU Seeks long-term capital appreciation. It uses an integrated research, portfolio-design, management, and trading process to build a broadly diversified portfolio of U.S. companies while balancing long-term return drivers, risk, shorter-term considerations, and trading costs.

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

• DFAU Charges 0.12% a year, well under the 0.65% median for active US equity funds and the cheapest of the top-graded names in its group (AVLC, DFAC, FELC).
• Holds roughly 2,400 US companies, so no single name steers the fund. Whole-market coverage, not a concentrated bet.
• Active without the stock-picking drama: it leans weights toward value, profitability and momentum, using the Russell 3000 as its reference point rather than a rigid rulebook.
• A multi-billion-dollar fund that trades actively, and one of the strongest overall implementations in its active US equity 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

• DFAU Those tilts cut both ways: results can drift from a plain Russell 3000 fund for long stretches, in either direction.
• No published index behind it. The trade-off for flexibility is that you're buying Dimensional's process, not a public set of rules you can check line by line.
• Distributions land quarterly, not monthly, and the mandate is long-term capital appreciation rather than income.

• 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 DFAU profile⁠

Full NLSI profile⁠