JEPI vs JEPQ: Which is a better covered call ETF to buy?

The JPMorgan Nasdaq Equity Premium Income ETF (JEPQ) and the JPMorgan Equity Premium Income ETF (JEPI) have accumulated assets because of their high dividends. JEPI has over $38.9 billion in assets, while JEPQ’s assets have soared to over $24 billion. This article compares the two funds and assesses the better one to buy.

What is the JPMorgan Nasdaq Equity Premium Income ETF?

The JEPQ ETF is a popular fund that aims to give investors exposure to the tech-heavy Nasdaq 100, while still generating a strong dividend return to investors. 

It does that by first investing in all companies in the Nasdaq 100 Index. This includes companies like NVIDIA, Tesla, Microsoft, Apple, and Google. Historically, the Nasdaq 100 Index has a good record of beating other benchmarks like the S&P 500 and Dow Jones. 

After this, the fund then uses the covered call strategy by selling covered call options on the Nasdaq 100 Index. The benefit of this approach is that it lets the fund generate a regular income through the premium payments it generates.

What is the JPMorgan Equity Premium Income ETF?

The JEPI ETF is a popular ETF that works in the same way as JEPI, but it has a key difference in that it focuses on the S&P 500 Index. It invests in a diversified group of companies in the S&P 500, and then sells call options on the index. 

JEPI does not invest in all the companies in this index. Instead, it invests in about 112 companies, including large names like Amazon, Travelers, Mastercard, ServiceNow, and Meta Platforms. 

Read more: JEPI ETF put to the ultimate test: is it beating VOO and SPY?

JEPI vs JEPQ: Better covered call ETF to buy?

A common question is on the better investment between JEPI and JEPQ. The first low-hanging fruit in this analysis is to consider the expense ratio of the two funds. 

The two of them have a similar cost of 0.35%, making it a tie. However, when comparing fees, one can also consider the fact that popular ETFs that track the S&P 500 and Nasdaq 100 indices have a lower expense ratio. 

The other data to watch is their dividend yield, a notable thing since investors acquire these funds for their payouts. JEPQ has a dividend yield of 11.23%, while JEPI yields 7.80%. This means that a $100,000 investment in JEPQ will bring in a dividend return of $11,200, while JEPI will bring in $7,800. These returns excludes the price appreciation and the fees changed. 

Therefore, the JEPQ ETF is a better investment than JEPI since it has a higher return than the JEPI one. 

Read more: JEPQ vs JEPI: Are these boomer candy ETFs good buys in 2025?

Return comparison between JEPI and JEPQ

The other thing to consider when looking at the best ETF to buy is their total returns over the years. When doing this comparison, it is worth to note that past performance is not an indication of what will happen in the future. 

However, I believe investing in an asset with a long track record makes more sense than the laggard. For example, investors have been rewarded well by investing in the Nasdaq 100 Index instead of buying the Dow Jones. 

The chart above shows that the JEPQ ETF has had a total return of 37% in the last three years, much higher than what JEPI had. Similarly, JEPQ has risen by 9.7% this year compared to JEPI’s 6.35%. 

Therefore, these numbers, together with the dividend yield, show that the JEPQ is a better fund to buy than JEPI.