JEPQ: This Could Be The Fund's Best Year

seekingalpha04-24

gopixa Dividend investors are having a much harder time getting inflation-adjusted income and total returns. With prices still high and the broader indexes near record highs, finding investments ...

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With prices still high and the broader indexes near record highs, finding investments ...</p>\n\n<a href=\"https://seekingalpha.com/article/4685507-jepq-this-could-be-the-funds-best-year\">Source Link</a>\n\n</div>\n","source":"seekingalpha_fund","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>JEPQ: This Could Be The Fund's Best Year</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nJEPQ: This Could Be The Fund's Best Year\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-04-24 09:59 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4685507-jepq-this-could-be-the-funds-best-year><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>gopixa Dividend investors are having a much harder time getting inflation-adjusted income and total returns. With prices still high and the broader indexes near record highs, finding investments ...</p>\n\n<a href=\"https://seekingalpha.com/article/4685507-jepq-this-could-be-the-funds-best-year\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"IVV","symbol_name":"标普500指数ETF","start_time":0,"source_url":"https://seekingalpha.com/article/4685507-jepq-this-could-be-the-funds-best-year","article_id":"2429176942","we_media_id":null,"thumbnails":["https://static.seekingalpha.com/cdn/s3/uploads/getty_images/1472468191/image_1472468191.jpg"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2429176942","pubTimestamp":1713923980,"sourceInfo":{"source_id":"seekingalpha_fund","name":"Seeking Alpha"},"weMediaInfo":null,"summary":"gopixa Dividend investors are having a much harder time getting inflation-adjusted income and total returns. With prices still high and the broader indexes near record highs, finding investments offer","collect":0,"end_time":0,"defaultTopTitle":"seekingalpha.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"IVV":"标普500指数ETF","BK4504":"桥水持仓","BK4581":"高盛持仓","BK4112":"金融交易所和数据","JEPI.AU":"JPMORGAN EQ PREM INCOME ACTIVE ETF","SSO":"两倍做多标普500ETF","JEPI":"JPMorgan Equity Premium Income ETF","BK4532":"文艺复兴科技持仓",".SPX":"S&P 500 Index","SPY.AU":"SPDR® S&P 500® ETF Trust","OEX":"标普100","JEPQ":"J.P. MORGAN NASDAQ EQUITY PREMIUM INCOME ETF","SDS":"两倍做空标普500ETF","SH":"标普500反向ETF","BK4534":"瑞士信贷持仓","BK4585":"ETF&股票定投概念","SPXU":"三倍做空标普500ETF","FDN":"First Trust Dow Jones Internet I","CBOE":"芝加哥期权交易所","BK4559":"巴菲特持仓","SPY":"标普500ETF","UPRO":"三倍做多标普500ETF","BK4588":"碎股","BK4550":"红杉资本持仓","OEF":"标普100指数ETF-iShares"},"translate_title":"JEPQ：这可能是该基金最好的一年","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"SPY.AU":1,"SPY":1,"CBOE":1,"JEPQ":1,"JEPI.AU":1,"JEPI":1,"FDN":0.9,"US7Y.BOND":0.65,"US10Y.BOND":0.65,"US12M.BOND":0.65,"US2Y.BOND":0.65,"US30Y.BOND":0.65,"US3Y.BOND":0.65,"US5Y.BOND":0.65,"US6M.BOND":0.65,"US912797HH31.BOND":0.6,"US912796CX52.BOND":0.6,"US912797FH58.BOND":0.6,"US912797FS14.BOND":0.6,"US912797GB79.BOND":0.6,"US912797GK78.BOND":0.6,"US912797GL51.BOND":0.6,"US912797GW17.BOND":0.6,"US912797HE00.BOND":0.6,"US912797HG57.BOND":0.6,".SPX":0.6,"UPRO":0.6,"ESmain":0.6,"IVV":0.6,"OEF":0.6,"OEX":0.6,"SDS":0.6,"SH":0.6,"SPXU":0.6,"SSO":0.6},"content_text":"gopixa Dividend investors are having a much harder time getting inflation-adjusted income and total returns. With prices still high and the broader indexes near record highs, finding investments offering consistent and solid income is much harder in the market today. One form of investment that has evolved a lot in just the last five years that is focused on dividends and income is covered call funds. A more well-known exchange-traded fund that uses this options strategy is the JPMorgan Nasdaq Equity Premium ETF (NASDAQ:JEPQ). Data by YCharts JEPQ's inception date is in early May 2022, and this fund has offered investors total returns of 23.53% since that time. The S&P 500 (SPY) has offered investors total returns of 23.25% during this same time period. I last wrote about JEPQ in September 2023, and I rated the fund a buy primarily because of how I thought increasing levels of volatility and forex moves would impact the ETF's income and overall returns. I am now upgrading this fund to a strong buy. With the upcoming presidential election, a slowing but stable economy, and increased tensions abroad, volatility levels in the market are likely to continue to rise throughout the year. Earnings estimates for big-cap tech remain solid as well, the downside risks to this fund should be acceptable to investors. JEPQ's strategy of selling out-of-the-money options should also be best suited for the likely market conditions in 2024. Overview JEPQ HAS an expense ratio of .35%, the fund has $11.67 billion in assets under management, and the ETF's trailing yield is 9.49%. The exchange-traded fund seeks to track the Nasdaq 100, and the ETF's holdings are 49.76% technology, 16.11% communication, 13.51% consumer cyclical, 6.62% health care, 6.21% consumer defensive, 4.01% industrials, 1.29% basic material, 1.08% utilities, .67% financials, .47% energy, and .29% real estate. The ETF also has holdings of 16.95% corporate bonds and .57% cash and equivalents. This fund reserves the right to invest up to 20% of the monthly income the ETF derives, primarily from selling options in assets such as bonds. A list of JEPQ's holdings (Seeking Alpha) JEPQ uses a similar options strategy to the JPMorgan Equity Premium ETF (JEPI), the fund sells monthly out-of-the-money calls that are close to 5% out of the money, so investors can take part in some of the upside in the underlying assets in addition to getting income from the monthly options being sold and regular dividends being paid. The payouts from options that this fund makes monthly are taxed at ordinary income rates. A List of the Income JEPQ has Paid Out (NASDAQ) JEPQ's monthly payouts have ranged from $.33 a month to $.68 a month since the fund's inception in the middle of 2022, but the monthly payouts have consistently been between $.38 and $.43 a share since early 2023. Summary Options funds such as JEPQ perform best when volatility levels are elevated, but risk to principal is not excessive. The volatility premiums in the monthly options this fund sells are higher when the market is more volatile, but because this fund caps upside potential while leaving downside risks unlimited, investments such as JEPQ can underperform when sell-offs are more severe. Tensions worldwide remain high with Israel and Iran recently firing missiles, the war between Israel and Hamas continuing, the conflict between Russia and Ukraine showing no signs of ending this year, with Congress expected to approve more foreign aid this week. The VIX, which measures overall levels of volatility in the indexes, is also at a five-year low. A Chart of the VIX (CBOE) Most economists expect growth rates to remain slow in the US and abroad this year, and the upcoming 2024 presidential election in America should create more unpredictability about the future of monetary and fiscal policy in the country. A Chart of the VIX (Macrotrends) Most economic estimates for the US and most of the G-8 nations are predicting solid but slow growth this year. A Chart of Expected Growth Rates from 2023-2025 (IMF) While economists are also forecasting the economy in the US and abroad to avoid a recession this year, growth is still supposed to be slow for some time, with the impact of rising rates still fully being felt throughout the US. Volatility levels should rise throughout the year even while earnings estimates remain strong and growth rates are expected to remain stable, since the Fed's outlook on the current rate cycle remains unclear, and the economy is far from strong. The IMF recently stated a baseline forecast of 3.2% growth worldwide in 2024, with economists at the institution referring to the global economy as slow but resilient. A Comparison to Peers JEPQ and JEPI both use options strategies that sell monthly out-of-the-money calls, and both funds have outperformed most other covered-call funds that sell at-the-money options, such as RYLD and QYLD, over the last several years. The ETF's selling at-the-money calls have generally seen more net asset value loss than funds such as JEPQ and JEPI, that gives investors some upside in the core holdings of the exchange-traded funds. The net asset value losses funds selling at-the-money calls have generally seen even in what has been a fairly strong performing market over the last 2 years should concern investors. Risks All investments have risks, and if the economy were too slow dramatically and this fund sold off hard, this ETF would underperform most of the indexes because of the options strategy this exchange-traded fund uses sells off most of the upside potential in the core holdings. The Fed's decision to hold rates high for longer should also cause the dollar to continue to rise against most major foreign currencies, and big-cap tech gets nearly 60% of the sector's earnings from outside the US. Also, if the economy were to strengthen and inflation were to come down, volatility levels would likely drop and the income from the selling of monthly calls would likely be at the bottom of the recent range JEPQ has seen, around $.33 a month. Conclusion  Still, the most likely market condition we will see this year is for a fairly range-bound market with heightened volatility, since there are multiple levels of uncertainty in the US and international economy. The Fed's recent decision to not lower rates creates more uncertainty about the current rate cycles the US is in as well. While covered call funds are not built to outperform the broader indexes over extended periods of time, JEPQ should continue to offer solid income with acceptable risks.","kind":null,"is_publish_news":null,"is_publish_highlight":null,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.22.4","shortVersion":"4.22.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2429176942"}