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.
Buy and hold high-quality companies or ETFs to build wealth over a long-term horizon, but some investors prioritize passive income. Bonds, Treasury Bills, money market funds, and high-yield savings accounts are traditional options for passive income outside equities. However, the ETF industry has expanded, offering covered call ETFs that cap upside potential for income.
Two large covered call ETFs are the JPMorgan Equity Premium Income ETF (JEPI) and the JPMorgan Nasdaq Equity Premium Income ETF (JEPQ), with JEPI focusing on S&P 500 components and JEPQ targeting Nasdaq-100 components.
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