Experts Top 5 Retirement Income ETFs

With inflation running well over the Fed’s 2% goal, generating real income is harder than ever.

That’s why we wanted to see how the pros handled the situation.

And according to our TrackStar data, there were five ETFs paying dividends that yield over 6% annually.

One of our favorites was at the top of the list: JPMorgan Equity Premium Income ETF (JEPI).

This actively managed fund pays a hefty 7.6% dividend yield while coming with lower volatility than the overall market.

So, is this ETF right for your portfolio?

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Key Facts About JEPI

• Net assets: $32.7 billion
• 12-month trailing yield: 7.56%
• Inception: May 20, 2020
• Expense ratio: 0.35%
• Number of holdings: 119

JP Morgan’s Equity Premium Income ETF is unique for several reasons.

It’s an actively managed ETF. Yet, its expense ratio sits at just 0.35%.

The ETF is run by managers with over 60 years of combined investing experience. They employ a bottom-up fundamental research with proprietary risk-adjusted stock rankings. Then, they overlay out-of-the-money option call writing to generate monthly income.

Combined, this creates a uniquely attractive option for folks seeking a steady stream of income.

Source: JP Morgan

The top 10 holdings in the ETF include some popular names as well as a few you might not expect.

Source: JP Morgan

Overall, the ETF has a bit more exposure to financials and less to IT than the S&P 500 index.

Source: JP Morgan

Performance

While the ETF pays a healthy dividend, it gives up a fair amount of capital appreciation compared to the broader indexes.

That becomes quite evident when you look at the 1-year returns.

However, over the long run, things are a bit more balanced.

Source: JP Morgan

Because the ETF is newer, we don’t have comparison points beyond the last four years.

Competition

To give you a point of comparison, we pulled in the top ETFs with a +6% dividend sought out by financial pros over past month.

• Cboe Vest S&P 500 Dividend Aristocrats Target Income ETF (KNG): Focuses on companies in the S&P 500 that have consistently increased their dividends for the past 25 years.
• Global X NASDAQ 100 Covered Call ETF (QYLD): Holds the Nasdaq 100 equities and then sells covered calls against them to generate income.
• Global X SuperDividend U.S. ETF (DIV): Seeks out high dividend paying equities while diversifying risk across sectors.
• Global X U.S. Preferred ETF (PFFD): Invests in an array of preferred equities that typically pay higher dividend yields but have more limited capital gains.

Our Opinion 10/10 

JEPI’s total returns beat the others in our list while providing a juicy yield.

Although its track record is short, the fund has excellent managers.

On top of all that, the ETF has excellent liquidity with a rock-bottom expense ratio for an actively managed fund.

If you need regular income from your investments, JEPI is a solid choice.

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