What You May Have Missed This Week...
Low-risk/high yield bond ETFs, JEPI vs. JEPQ and some dividend ETF ideas from a chief investment strategist
In addition to the regular posts here on Substack, I also publish ETF research and notes over on my blog, ETF Focus on TheStreet.
In case you wanted to catch up on the latest research above and beyond what you’re reading here, this is a quick list of some of the most recent articles from the blog!
An Investing Expert Explains How He Screens For the Best Dividend ETFs
To get some ideas, I grabbed a few quotes from Wes Moss. Wes is the Managing Partner and Chief Investment Strategist of Capital Investment Advisors, a registered investment advisor firm with over $4 billion in assets under management. He is also the host of the Retire Sooner podcast, a Certified Financial Planner (CFP), and the author of three books on retirement planning. Here's what he had to say about dividend ETFs.
Why Is Your Cash Sitting In A Bank Account? 5 Low Risk ETFs With A 5% Yield
It was just two short years ago that investors looking to pivot away from stocks and into cash needed to effectively accept zero return for the privilege. Treasury bills and money market funds were literally paying 0%. You could push into long-term Treasuries for a modestly higher 1.5% yield, but who really wants to take that kind of risk for so little yield? Junk bond ETFs paid around 4%, but, again, is the risk really worth it? Flash forward to today and it's a much different environment.
If You Love JEPI, You Need To Check Out JEPQ
There might be no dividend ETF that's more popular right now than the JPMorgan Equity Premium Income ETF (JEPI). Its $8.4 billion net inflow year-to-date places it at #3 in the entire ETF marketplace! What many investors aren't aware of is that JEPI has a little sibling! The JPMorgan Nasdaq Equity Premium Income ETF (JEPQ) is managed in substantially the same manner as JEPI, only its underlying index is the Nasdaq 100 instead of the S&P 500. It uses the same style ELNs for covered call exposure, also considers ESG factors and aims to remain less volatile than the Nasdaq 100. Essentially, it's only the index used that is the difference.
NUSI vs. QCLR: Comparing Two Defensive Derivative-Based ETFs
Earlier in March, I reviewed the Nationwide Nasdaq-100 Risk-Managed Income ETF (NUSI) and noted that while its options collar strategy did well during the March 2020 COVID-19 crash, it didn't hold up as well throughout the 2022 bear market. There is another option for risk-conscious investors though – the Global X Nasdaq 100 Collar 95-110 ETF (QCLR). Let's take a look at this ETF head-to-head against NUSI and see how it fares.
SGOV vs. BIL: Which Treasury Bill ETF is Best for You?
The one benefit of the bear market in bonds since the beginning of 2022 is that it's turned Treasury bills into a compelling asset class again. Gone are the days where T-bills paid literally nothing. Today, you can get nearly a 5% dividend yield from a virtually risk-free investment. If you're looking to invest in ultra short-term Treasury bills, there are two primary ETFs to consider.
DIVO: A Winning Combination of High Quality Stocks and High Dividend Yield for Savvy Investors
In the world of high yield dividend ETFs, the Amplify CWP Enhanced Dividend Income ETF (DIVO) is quickly becoming a big player. Its combination of durable, large-company stocks and a tactical covered call strategy has been great for delivering a steady and predictable high yield for investors. DIVO seeks to provide gross annual income of approximately 2-3% from dividend income and 2-4% from option premiums.
JEPI vs QYLD: Battle of the Covered Call ETFs
Two ETFs that attracted high inflows throughout 2022, and continue to do so after the first quarter of 2023 are the Global X NASDAQ 100 Covered Call ETF (QYLD) and the JPMorgan Equity Premium Income ETF (JEPI) respectively. Both QYLD and JEPI are derivative income ETFs. That is, they employ covered call overlays to enhance income. Depending on which Reddit community you come across, you'll find either high praise or vitriol dislike for one. Let's break down both ETFs and see how they fare head to head.