Investors are drawn to JPMorgan Equity Premium Income ETF for its 7% monthly distribution yield

From Nasdaq: 2024-06-25 05:06:00

The JPMorgan Equity Premium Income ETF (JEPI) is a favorite vehicle for generating passive income with a nearly 7% monthly distribution yield. The ETF uses a two-pronged strategy of holding high-quality stocks and writing out-of-the-money call options on the S&P 500. This approach aims to offer income with equity market exposure and less volatility.

JEPI’s last monthly distribution payment equated to a 7% yield, surpassing high-yield junk bonds and other income-generating options like REITs and the S&P 500. The ETF’s blend of monthly income distributions and potential equity appreciation has resulted in an impressive average return of 12.5% annually since its inception in 2020.

The fund may not outperform the S&P 500 during strong markets, but its defensive portfolio and option-writing strategy help mitigate downside risk. JEPI offers a compelling combination of monthly income, equity upside potential, and downside protection, making it an attractive choice for investors looking to grow their income and wealth over time.



Read more at Nasdaq: Why I Can’t Seem to Get Enough of This Ultra-High-Yielding Dividend S&P 500 ETF