JEPI and JEPQ Yield Way More Than SCHD, but SCHD Could Produce More Passive Income Over the Long Term. Here's Why.
Long-term holders of the Schwab U.S. Dividend Equity ETF have seen their yield on cost gradually rise.
Overview
Buying and holding high-quality companies or exchange-traded funds (ETFs) is an excellent way to build wealth over a long-term time horizon. But some investors prioritize passive income over long-term capital appreciation to supplement retirement income, cover a portion of their expenses, or align with other financial objectives.
Bonds, Treasury Bills (T-Bills), money market funds, and high-yield savings accounts remain go-to solutions for investors seeking passive income outside equities. But the ETF industry has grown rapidly in size and sophistication.
Details
Now, investors can buy covered call ETFs, which cap upside potential in exchange for income. The JPMorgan Equity Premium Income ETF (NYSEMKT: JEPI) and the JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ: JEPQ) have emerged as two of the largest covered call ETFs by net assets, with the former focusing on S&P 500 (SNPINDEX: ^GSPC) components and the latter geared toward components of the Nasdaq-100.
Source
Originally published at www.fool.com.