Dave, the reason JEPI had such a good 2022(losing less than SPY) was because it had a light concentration in Information technology. As you may recall the NASDAQ was down 30% and the S and P was minus 20%ish. JEPI has no downward protection by buying puts. I just checked and the current % in information technology for JEPI is 14.6%. This is much closer to the S and P 500 allocation. If technology takes another dive like 2022 you would have JEPI pretty much so follow suit. That said, I own JEPI but like SPYI more(own a bunch of it) because it distributes 1% of it's principle per month(12% annually) and 90% of its distributions are considered return of capital. If you own this in a taxable account as I do, paying 24% federal and 6% state it makes a HUGE difference.
I totally agree about SPYI. Not throwing shade on JEPI as it is a good product in the covered call space. I think SPYI is a better SP 500 CC ETF because of it's (IRS 1256) tax rules on SPX option income (60% LT/40% ST) and/or the CONSTRUCTIVE Return of Capital which is non taxable.
Good points! One of the JEPI advantages (or potential advantages) is the active management with stock selections. Looks like it worked last time. I'm still watching SPYI but own a few shares.
100% agree to all of this. Investing for income is great, but even greater if you are investing the gains from decades of growth investing. Firmly in both camps right now with taxable accounts transitioning to income and retirement accounts still invested in growth for at least another 10 years.
The explicit goal of JEPI is "low volatility" and IIRC they say they seek about 80% of the return of the S&P 500 (which will be realized primarily as distributions). Think of it as an alternative to about 70% in VOO and 30% in intermediate bonds.
I have both at 67 years old. As stated, like the appreciation of voo and the distributions of jepi. Watch all your videos for information and really like your coverage of covered etf and clear explanations. If you have time, wondering if you noticed the increase in svol's expense ratio and your thoughts on it. Thanks!
Hi. According to some folks at Simplify... The expense ratio increase has to do with cash repo facilities they use to increase yields on cash and tbills. This increases the yield but is required to be reflected in the exp ratio per the SEC. Keep an eye out for this to decrease in the next few months with a move away from repo in SVOL. Now, enjoy your research on cash repo facilities! I did! Lol.
Great overall view of the differences and the advantages that each type of investing offers. This video falls in line with my thoughts for retirement. My Plan is simplified for retirement and is 3 pronged. 1. I will take the total amount of all my yearly expenses including food and fuel plus 10% and invest into funds like JEPI so as to replace my payroll check and receive the periodic dividends for daily expenses. 2. I will lock in 5 years of that total expenses number in 1 and invest into high grade U.S. government bonds for a cushion. 3. The rest will stay in main line ETF's such as the Spiders and Blackrock ETF for overall wealth building. Maybe there will be something to put into 2 and 3, we will see.
I'm in my early retirement JEPI and JEPQ are working out just fine for me to pay my bills. I don't worry about taxes as I need cash flow! Uncle Sam will always want its cut! If I had VOO, I'd selling some to get the similar income. It's fine in an up year however in a down year, it'll not be that pretty!
Thanks for another great video. We also pay state income tax on distributions. Obviously that depends on the state you live. Here in MD, I pay about 6%. I like the idea of dividend/income investing. But for my taxable account I switched my focus on lower yielding ETFs (SPGP, CGDV,).
Thanks Dave, love your presentation style & channel! I'm having a hard time deciding which 'bucket' I fall into - I'm 60 and about 5-7 yrs away from retirement. Am I close enough to start slowly building up to more income positions? I do have 1 already, you're right, it is fun to watch it 😊
Hi. I'm probably a little premature but I've started to buy a few. Without asking a bunch of questions, I feel you would only be giving up a small % for some reduced volatility... A small % in your portfolio would not be a big deal IMO.
Hi Dave, enjoyed the video! Would you suggest to put VOO, JEPI, and SPYI into traditional IRA where tax will be applied once I make withdrawals in retirement. Thanks in advance.
nice simple and efficient portfolio, did you think about including XLU in it ? using the same reasoning that you explained for XLV : XLU underperformed in 2023 but everybody needs utilities and if consumption grows so does XLU
Hi Dave- I would be interested in seeing a video on how seasonality affects the stock market and trying to follow a historical market return pattern for investing for a better return. I know timing the market is a bad idea usually but the market does seem to behave similarly at different times of the year and maybe this is enough information for a better return than just buy and hold? Anyway, I love your content and your perspective…
Hi. I recently looked at TLTW in this video: ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-bzIObFNlWPg.html And I looked at TSLY and NVDY is this one: ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-P953p1y_fZs.html
Hi. They make no sense to me... Buy 50% XYLD and 50% VOO to make XYLG and save half the expense fee. Right? ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-uQ5Jrvc93z0.html
What about buying Jepi/jepq/Spyi as a younger guy and letting the shares accumulate over time.? Today’s shares will be cheaper than they will in 20-30years . I don’t see anybody talking about this . Or is my idea going to my to back fire? I figure if I can get 1000 shares of something that distributes 10-12 % monthly and can build up to 10,000 by retirement that’s a good chunk of my monthly expense ( even if variable) .
Thank you for your analysis. I have XYLD 30% and DIVB 70% now. I buy those ETF from 50% of my salary. I may buy VTI instead of DIVB. I paid too much of tax in NY every year. So XYLD (30%) vs VTI (70%) should be good? My target is $3M ($1M of XYLD and $2M of VTI) in 15 years when I retire.
DIVB is a good fund and so is VTI. I'm not a fan of XYLD and prefer some of the newer versions like JEPI, SPYI, and GPIX. That NY state tax can eat you up as well... So if you still have time till retirement, might be good to avoid all of them in a taxable account.
@@wealthadventures Thank you for your thoughtful remarks. This is my another google account. I didn't anticipate you would respond to my question. After watching some of your earlier videos, I decided to sell DIVB and purchase SCHD (40%) today. Additionally, I plan to sell XYLD within the next six months and acquire DIVO (40%), which you recommended in one of your previous videos. While I agree with your advice to steer clear of high-income ETFs, I am interesting to buy some JEPQ (
Would it be a good idea to have jepi or jepq in my Roth Ira? I have voo and vug already. I thought would be good to have a dividend focused etf for the snowball effect
if im 35 and have 100000 and contemplating taking this 100000 and using it for more income to invest into growth, it may be beneficial by the calculators to invest 17000 a year with 0 in growth vs 7000 a year and have 100000 in growth etfs.
It is in a tax deferred account? I still think long term growth will outperform for total return. That is the goal. So really depends on if you can afford to not use the money at this time and have time till retirement. That way, it can do its job and grow.
As a foreign investor I'm wondering whether there are equivalents of JEPI domiciled in a country which doesn't charge withholding tax, such as e.g. Ireland or the UK?
there is an ETF Acc type from UBS in Ireland, 0.29% expenses, started in July 2020, 45% returns since inception but it is quite small with 6M EUROS AUM, I think Global X also has one in Ireland
All investing is "income" investing. The goal of investments is to fund future spending. The aversion to having to sell some shares in a down market is irrational when you factor in long term opportunity cost, fees and taxes. These covered call products don't do anyone any favors.