Today’s video will focus on how to use JEPI – The JP Morgan Equity Premium Income ETF – in a portfolio.
Unlike most investment channels, this one is run by two EXPERIENCED investment professionals who used to show Portfolio Managers at Merrill Lynch and Morgan Stanley how to evaluate funds and build portfolios. Today, I’m going to show YOU how to do that with JEPI.
We’ll start with a brief overview of what JEPI is and how it’s managed, then get into how it can be expected to perform in different market environments, which kinds of investors should… and should NOT consider it, and how it can compliment other strategies in an investor’s portfolio. Let’s dive in.
At its most basic level, JEPI is a U.S. equity covered call ETF.
What’s a covered call ETF? In a nutshell, it buys stocks, then writes, or sells, call options on them.
A call option gives the buyer the right to buy a stock at a set price. Of course, they’d only want to do that if the stock goes HIGHER than that price. So, if you’re SELLING those options, like JEPI is, that means SOMEONE ELSE gets to benefit from the upside in the stocks if they go up a lot.
So to recap, JEPI buys stocks, then sells call options on them. That means you get A LITTLE of the upside potential, but then anything beyond that set price, which is called the strike price, you give up. And what do you get for giving up your upside potential? A juicy yield, and THAT is the main reason people buy ETFs like JEPI. Right now, it’s yielding almost 8%.
Now that you’ve got the basics down, let’s dive a little deeper into how JEPI is managed, since it differs from the typical covered call ETF in a few important ways.
First of all, JEPI is actively managed. It starts with the stocks in the S&P 500, but rather than try to mimic the index, the portfolio managers basically try to create a lower-risk version of it.
That’s important, because if you’re going to give up the upside potential, you want to also be protected on the downside.

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0:00 Intro
00:37 JEPI basics
1:22 How JEPI is managed
2:07 JEPI vs S&P 500 in down markets
2:28 JEPI vs bonds
3:21 JEPI in down markets
6:11 JEPI in the long run
7:04 Paradox of covered call ETFs
8:10 JEPI for young investors
8:29 JEPI in an IRA
8:54 JEPI for retirees
10:05 My preferred retirement income approach

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The JPMorgan Equity Premium Income ETF, also known as JEPI, is a popular investment option for investors looking to add diversification and income to their portfolio. JEPI is an exchange-traded fund that focuses on providing investors with premium income through a combination of equity and option strategies.

Here are some tips on how to effectively incorporate JEPI into your investment portfolio:

1. Understand the investment strategy: JEPI utilizes an innovative investment strategy that aims to generate income while providing potential for capital appreciation. The fund combines a core portfolio of US equities with an options overlay strategy to enhance income potential. Investors should carefully review and understand the fund’s investment objective, strategy, and risks before adding it to their portfolio.

2. Consider your investment goals: Before adding JEPI to your portfolio, consider your investment goals and risk tolerance. JEPI may be suitable for investors looking to generate income and potentially reduce portfolio volatility. However, like all investments, JEPI carries risks and it’s important to align the fund’s strategy with your investment goals.

3. Evaluate the fund’s performance: Review JEPI’s historical performance and track record to assess its potential benefits and risks. Consider how the fund has performed in various market conditions and compare it to other income-generating investments in your portfolio. Keep in mind that past performance is not indicative of future results.

4. Monitor the fund’s holdings: Stay informed about JEPI’s holdings and the fund’s overall composition. Regularly review the fund’s top holdings, sector allocations, and option overlay strategy to ensure that it aligns with your investment objectives and risk tolerance. Monitoring the fund’s holdings can help you make informed decisions about rebalancing your portfolio.

5. Rebalance your portfolio: Regularly rebalance your portfolio to maintain appropriate asset allocation and risk levels. Consider adjusting your allocation to JEPI based on changes in your investment goals, market conditions, and the fund’s performance. Rebalancing your portfolio can help ensure that it remains aligned with your long-term investment strategy.

Overall, JEPI can be a valuable addition to a diversified investment portfolio, offering investors the potential for income generation and diversification. By understanding the fund’s strategy, evaluating its performance, and monitoring its holdings, investors can effectively incorporate JEPI into their investment portfolio to achieve their financial goals.