The Reset Is Complete — Here's Everything

Last week I sold seven positions and exited one more, taking $11,744 in net losses. Then I put that capital back to work. The portfolio has been rebuilt. And honestly? The numbers surprised me.

 If you’ve been following along since Issue #14 you know this has been the most significant stretch in The Yield Letter’s history. A painful but necessary rebalancing. Eight exits. Realized losses I wasn’t proud of but needed to acknowledge honestly. And a commitment to rebuild on a stronger foundation.

 That foundation is now in place.

 This week I’m sharing everything — the confirmed purchases, the updated income projection, the new 29-position portfolio, and what the first week of August is already showing. There’s also something I want to say at the end of this issue that goes beyond the numbers. Something about why I actually do this.

 Let’s start with what I bought.

On August 3rd I executed the seven exits I described in Issue #14. Then on August 5th I exited one more position — SMCY, my small Super Micro Computer covered call holding of 35 shares, sold at $4.615 for proceeds of $161.53. I redirected those proceeds directly into SCHD. The SMCY exit wasn’t about the size of the position — it was tiny. It was about the principle. With 97.24% of SMCY’s most recent distribution classified as return of capital, it was essentially handing me my own money back every week while the NAV quietly declined. That’s not income. That’s an illusion of income. It had to go.

On August 6th, I stopped waiting for a down day and pulled the trigger on the redeployment. Here’s why I stopped waiting — and I’ll be honest about this because it’s a useful lesson. I had been holding off, hoping for a meaningful pullback on these four positions. What I eventually realized is that SCHD, QQQI, SPYI, and BTCI simply don’t move dramatically day to day. These are stable, index-based income ETFs. Waiting for a 5% pullback on SCHD is a little like waiting for the perfect parking spot — you might wait so long you miss the whole event. Sometimes good enough is good enough.

 So on August 6th I executed all four purchases.

346.264 shares purchased across three accounts at an average price of $33.65 per share plus the small SMCY proceeds. Total combined cost: approximately $11,817.

 Combined with my existing 355 shares this brings my total SCHD position to 701 shares — now my single largest holding and the anchor of the new portfolio. SCHD is not a covered call ETF. It doesn’t pay 30% or 40% yield. It pays a modest and growing quarterly dividend backed by real dividend-growing companies. It is in this portfolio specifically because it builds wealth rather than distributing it away. My existing SCHD position had a +25.35% IRR — the best performer in the entire portfolio before the rebalancing. Doubling down on your best performer is not a complicated decision.

100 shares purchased at $54.88 per share. Total cost: $5,488.

 This brings my total QQQI position to 330 shares. QQQI is one of my highest conviction income positions — a NEOS fund using a tax-efficient covered call strategy on the Nasdaq-100. It passed all five criteria I now require of every income ETF in this portfolio. In my existing position QQQI had a +8.45% IRR. That’s not flashy but it’s honest income that doesn’t erode your capital base.

70 shares purchased at $53.98 per share. Total cost: $3,779.

 This brings my total SPYI position to 270 shares. Same thesis as QQQI — NEOS management, S&P 500 exposure, tax-efficient covered call strategy. My existing SPYI had +8.01% IRR and essentially flat NAV. That is exactly what I want more of in this portfolio.

130 shares purchased at $28.66 per share. Total cost: $3,726.

This brings my total BTCI position to 303 shares. I kept BTCI through the rebalancing when I exited MSTW, MSTY, YBTC, and YETH — and I’ll tell you exactly why. BTCI uses a monthly covered call strategy with out-of-the-money strikes managed by NEOS. That structure is fundamentally different from the aggressive weekly at-the-money strategies that destroyed the value of the positions I exited. If Bitcoin recovers from its current $65,000 level toward the $100,000-150,000 range analysts broadly expect BTCI will participate meaningfully in that upside while continuing to generate monthly income throughout the recovery. That’s a thesis I’m comfortable holding.

 The confirmed purchases are above. What follows is the complete income picture, the IRR improvement breakdown, the full 29-position portfolio, and the first week of August distribution data.