ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Active ETF
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Energy Infrastructure
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Free Cash Flow
    • Gold/Silver/Critical Minerals
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Market Insights
    • Modern Alpha
    • Night Effect
    • Portfolio Strategies
    • Retirement Income
    • Richard Bernstein Advisors
    • Tax Efficient Income
    • Volatility Resource
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • Company
    • About VettaFi
    • Get VettaFi’ed
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Core Strategies Channel
  2. Exchange: The Use Case for JEPI in 2023
Core Strategies Channel
Share

Exchange: The Use Case for JEPI in 2023

Elle CarusoFeb 05, 2023
2023-02-05

The JPMorgan Equity Premium Income ETF (JEPI A) surged in interest in 2022 as investors looked for a compelling ETF for generous income.

JEPI broke the record for biggest annual inflows into an active ETF last year, topping the ARKK Innovation ETF (ARKK B+) ‘s 2020 record. But after hauling in nearly $13 billion in 2022, many advisors are wondering what’s next for the fund and how it’s positioned this year as markets evolve.

In a discussion led by Nate Geraci, president of The ETF Store at Exchange: An ETF Experience, ETF industry veterans discuss their outlooks for the uber-popular ETF.

“It was run as an institutional strategy in an SMA for JPMorgan. Advisors love that — they love to hear like Goldman and JP Morgan institutional, but now it’s for the people. And I like it too. I think that stuff should be democratized,” Eric Balchunas, senior ETF analyst & funds product specialist at Bloomberg, said at Exchange. "It actually uses equity-linked notes, which essentially wrap up the premium that’s paid out from the options. But they do that because then it’s the ordinary income. I mean, it’s tax-like dividends, and so you don’t get the taxation. So there’s a little extra something in there for tax purposes, which is clever.

The Use Case for JEPI

However, Balchunas cautioned that JEPI is the kind of strategy that won’t work and will underperform if you think the Fed will be dovish.

“Like Eric said, if the market goes up, if you have a quick rebound, this is going to underperform because it’s a covered call strategy. You’re going to have a limited upside — your options are in the money,” Aniket Ullal, head of ETF data and analytics at CFRA, said during the panel.

Elisabeth Kashner, vice president, director of ETF research and analytics at FactSet, said both JEPI and the Pacer US Cash Cows 100 ETF (COWZ A) take on many active risks.

“COWZ is a deep value play, but only moderate yield,” Kashner said. “JEPI is not as much value tilted, not as high dividend yield, but its actual distribution yield is very high – that’s from options.”

Kashner also warned that JEPI and COWZ could end up left behind in a frothy market.

For more coverage of Exchange 2023, please visit VettaFi | ETFdb.


Content continues below advertisement

Loading Articles...
Help & Info
  • Contact Us
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © 2023 VettaFi LLC. All rights reserved.
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X