Goldman Sachs acquires NEOS Investments for $2.3 billion
In brief
- Goldman Sachs acquires NEOS Investments for $2.3 billion in cash and equity.
- Deal adds $30 billion in assets to Goldman Sachs Asset Management's ETF business.
- Combined entity will manage $130 billion in ETF assets and $80 billion in active ETFs.
- NEOS specializes in systematic options-based income ETFs since 2022 launch.
- Transaction expected to close in Q1 2027.
Strategic Expansion in Active ETFs
Goldman Sachs is buying NEOS Investments, which manages 19 options-based income ETFs. The combined business will have more than $130 billion in ETF assets and approximately $80 billion in active ETFs, positioning the platform as the eighth-largest active ETF manager according to Morningstar data.
NEOS has been among the fastest-growing providers in the options-based income ETF category since launching in 2022. The firm's rapid ascent reflects broader investor appetite for structured income strategies. Derivative income ETFs have grown rapidly as investors seek higher-income, tax-efficient strategies and tools for managing market and interest-rate risks.
Market Momentum in Structured Products
The derivative income ETF category has reached approximately $180 billion in assets and recorded annualized growth of more than 70% since 2021. This expansion underscores the institutional demand for options-based strategies that balance yield enhancement with risk management.
NEOS co-founders Troy Cates and Garrett Paolella will join Goldman Sachs Asset Management as partners. The entire NEOS team is expected to transition to Goldman Sachs. Goldman Sachs has been aggressive in this space—the firm also absorbed Innovator Capital Management and its 171 defined-outcome ETFs.
This acquisition signals Goldman's commitment to scaling its active ETF platform and capturing share in the high-growth derivative income segment.
Frequently asked questions
Why is Goldman Sachs buying NEOS Investments?
Goldman Sachs is acquiring NEOS to expand its active ETF platform and capture share in the high-growth derivative income ETF segment. NEOS has been among the fastest-growing providers in this category since 2022, and the combined business will have approximately $80 billion in active ETFs, positioning it as the eighth-largest active ETF manager.
What are options-based income ETFs?
Options-based income ETFs are structured investment products that use derivative strategies to generate higher income and offer tax-efficient returns. Investors seek these products for managing market and interest-rate risks while pursuing enhanced yield compared to traditional equity or bond holdings.
How fast is the derivative income ETF category growing?
The derivative income ETF category has reached approximately $180 billion in assets and recorded annualized growth of more than 70% since 2021, reflecting strong institutional demand for structured income strategies.
