JPMorgan Equity Premium Income ETF

JEPI

Market cap $44.9B

The monthly deposits arrive like clockwork, as a retiree receives 8% annually, paid in 12 equal installments, backed by a fund with institutional credibility.

If you were to tell a retiree that you found a fund backed by JPMorgan and anchored in Nasdaq-100 equities, they might be interested.

A 7% yield sounds compelling until you ask the question that separates income investing from return-of-capital illusion: where is the money actually coming from?

The income gap between these two funds is not all that subtle when you consider that if you put $500,000 into the Schwab US Dividend Equity ETF (NYSE:SCHD) at its current 3.30% yield and collect roughly $16,500 per year in quarterly distribution.

Covered call ETFs have moved from a niche income strategy to one of the most discussed categories in retirement investing, and three names keep coming up in the same conversation, and all three pay monthly: JPMorgan Equity Premium Income ETF (NYSE:JEPI), JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ:JEPQ), and the NEOS Nasdaq-100 High Income ETF (NASDAQ:QQQI).

Tony Dong is the founder of ETF Portfolio Blueprint.

What's your plan for retirement? If you haven't given it much thought yet, it's worth starting with a simple question: where is your income going to come from?

Covered call ETFs offer attractive monthly yields, often exceeding 10%, appealing to income-focused investors. Most top covered call ETFs are heavily concentrated in large-cap growth, specifically S&P 500 and Nasdaq-100 exposures. This concentration introduces significant risk, as these ETFs exhibit strong performance correlations and similar downside profiles.

The JPMorgan Equity Premium Income ETF (NYSE:JEPI) has become one of the most popular retirement income funds in the market, and the appeal is easy to understand.

It can be an appealing idea to replace your paycheck with passive income. While it sounds exciting on the surface, it is a slightly complicated task.