2024-03-22 10:03:21 ET
Summary
- JEPQ has performed well in both downside volatility and upward-trending markets, but now is the time to deemphasize it.
- The dividend yield of JEPQ has dropped from 11% to 8.9% and is likely to continue decreasing due to the depressed VIX.
- The market is trading at all-time highs, creating an unfavorable entry point for JEPQ, which is heavily correlated with the Nasdaq 100.
- The Nasdaq 100 is also very interest rate sensitive, which in the context of three interest rate cuts this year creates a tough basis to beat.
- Since my previous buy thesis on JEPQ, the total returns have landed at ~20%. Now is the time to assume a more neutral stance.
Mid last year, I wrote an article on the JPMorgan Nasdaq Equity Premium Income ETF ( JEPQ ) arguing that it is a compelling vehicle through which to strike a balance between high current income and upside potential from the price appreciation perspective....
Read the full article on Seeking Alpha
For further details see:
JEPQ: 3 Reasons Why I Am Downgrading This ETF To Hold