Portfolio Rotation: Moving From High-Yield Concentration to Balanced Income Hedges
How I restructured my $860K income portfolio to protect against concentration risk while maintaining $180K+ annual income.
The Setup
About three weeks ago, I hit a wall with my portfolio. Not a financial wall—a philosophical one.
I was sitting on roughly $854K in a Fidelity Individual account, generating around $180K annually in distributions. Sounds stable, right? The problem wasn’t the income. The problem was where it was coming from.
I had massive concentration in high-yield, options-based ETFs—funds with yields in the 30-45% range. ARMW at 133%, GDXY at 44.5%, EGGY at 28%. These funds deliver incredible income, but they come with a cost: NAV erosion. Every month, the fund eats itself to fund those distributions. Over time, that compounds against you.
I was also carrying significant tech concentration—QQQI at 16% of the portfolio, FEPI (FANG options), and multiple AI-linked positions. And I had zero international diversification.
So when the AI sector took a breath last week and the market corrected, I didn’t panic. I saw an opportunity.
The Rotation
Here’s what I exited:
