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QYLD vs JEPI | Covered Call ETF In 2023! (Which is Better)

The Global X NASDAQ 100 Covered Call ETF (QYLD) is an exchange-traded fund (ETF) that seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the CBOE NASDAQ-100 BuyWrite V2 Index (BXN).

The BXN Index uses a "covered call" strategy on the NASDAQ-100 Index, which involves buying the underlying stocks in the index and then selling call options on those stocks. By selling call options, the fund generates income in the form of premiums, which can then be distributed to investors as dividends.

The amount of the dividend each month is determined by the income generated by the covered call strategy. This income is calculated by subtracting the fund's expenses from the premiums received from selling call options. The income is then distributed to investors on a monthly basis.

It's worth noting that because the fund uses a covered call strategy, it may not fully participate in the upside potential of the underlying stocks in the NASDAQ-100 Index. This is because if the price of a stock in the index rises above the strike price of the call option that was sold, the fund may have to sell the stock at the lower strike price, thus missing out on some potential gains. However, the covered call strategy also provides downside protection, as the premiums received from selling call options can help cushion the fund's returns if the underlying stocks decline in value.

The JPMorgan Equity Premium Income ETF (JEPI) invests in a diversified portfolio of stocks and writes covered call options on a portion of those stocks to generate income.

JEPI does not track an index, but instead, its investment strategy is actively managed by J.P. Morgan Asset Management. The fund's investment objective is to provide investors with equity-like returns, with less volatility and higher income than the overall equity market.

The fund's portfolio managers use a quantitative model to select a diversified portfolio of stocks from the S&P 500 Index, based on factors such as value, growth, quality, and momentum. They then write covered call options on a portion of those stocks, with the goal of generating income from the premiums received from selling those options.

The amount of income generated by the covered call options will depend on various factors, including the volatility of the underlying stocks, the strike price of the call options, and the expiration date of the options. The fund seeks to distribute a portion of this income to investors on a monthly basis.

Overall, JEPI's investment strategy is designed to provide investors with income and reduced volatility, while still allowing for potential equity-like returns.


*I am not a financial advisor, I make these videos for fun! This communication/content is for informational purposes only and is not intended as personalized investment advice, tax, accounting or legal advice, as an offer or solicitation of an offer to buy or sell, or as an endorsement of any company, security, fund, or other securities or non-securities offering. This communication should not be relied upon for purposes of transacting in securities or other investment vehicles.
#JEPI #dividendetf

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