Why I Built the IQ Score

Most income screeners reward one thing: yield. A fund pays 11%, it floats to the top of the list, and the story ends there. But yield is a decision the fund made, not evidence that the fund can keep making it. Plenty of high-yield vehicles fund their distributions out of your own capital and call it income.

The IQ Score is my attempt to separate durable income from decaying income — to tell a Friend from a Foe before the cut, not after.

What it actually measures

The score is built from five long-duration signals computed from years of price and distribution history:

• Economic payout coverage — total return versus what was distributed. The primary truth metric.
• Working-capital preservation — is the price base holding, or eroding?
• Distribution stability — how often has the payout been cut?
• Distribution trend — is the payout growing or drifting down?
• NAV persistence — for closed-end funds, does net asset value survive the distribution?

Every engine is calibrated so that yield alone never buys a Friend label. A yield trap has to clear the same durability bar as everything else.

Friend, Question Mark, Foe

The output is deliberately blunt: three labels instead of a false-precision number.

• Friend — the evidence supports durable income.
• Question Mark — mixed, or not enough history to say.
• Foe — the numbers say the distribution is living on borrowed time.

It is an observational layer. It does not trade, it does not size positions, and it never tells you what to buy. It just tells you which side of the durability line a security sits on — and lets you decide what to do with that.

That distinction is the whole point.