#7 - JPMorgan Equity Premium Income ETF (NYSEARCA:JEPI)
There are many exchange-traded funds (ETFs) that can help investors looking to benefit from high-yield dividends. An interesting choice is the JPMorgan Equity Premium Income ETF (NYSEARCA: JEPI), which sells covered call options to generate a portion of its revenue - something that may appeal to traders and investors alike.
Many buy-and-hold investors don’t trade options on individual stocks. Yet, in today’s market, options trading is vital to maximizing gains. That’s an attractive feature of the JEPI fund, which has generated a total return CAGR of 12.38% over the last five years with an average dividend yield of 10.43%.
Plus, the fund is largely concentrated in blue-chip large cap stocks. And its equal weight methodology means that each stock held by the fund is roughly as important as the others. It may limit the upside on a high-flying tech stock, but it also limits the downside risk to underperformers.
About JPMorgan Equity Premium Income ETF
The JPMorgan Equity Premium Income ETF (JEPI) is an exchange-traded fund that is based on the S&P 500 index. The fund is an actively-managed fund that invests in large-cap US stocks and equity-linked notes (ELNs). It seeks to provide similar returns as the S&P 500 Index with lower volatility and monthly income.
Read More - Current Price
- $58.48
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 1 Buy Ratings, 11 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $63.94 (9.3% Upside)
A stock's dividend yield measures a company's annual dividend income for every dollar invested in the stock. Simply put, it measures the amount of income you get from dividends relative to the price of the stock.
However, dividend yield isn't everything. That's because a stock's dividend yield and its price have an inverse relationship. Many stocks have a high dividend yield because of a fundamental problem with their business model that will prevent the stock price from increasing. In that case, a high-yield dividend will not be enough to generate a market-beating total return.
Dividend yield matters more than ever as investors deal with inflation that is higher than it's been in a generation. When inflation is close to the Federal Reserve's preferred target of 2%, it's not that difficult for a company to have a dividend that outpaces inflation. But that's harder to do when the rate of inflation is over 3.3%.
If you want to see more high-yield dividend stocks, MarketBeat offers a variety of screening tools that make it easy for you to find attractive dividend stocks that fit your investment style.
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