Maximize Your Returns with the Best High Dividend Covered Call ETFs
Вставка
- Опубліковано 1 жов 2024
- Maximize Your Returns with the Best High Dividend Covered Call ETFs
▸ Try Seeking Alpha Premium: seekingalpha.m...
▸ Try M1 Finance: click.linksyne...
▸ My Favorite Rewards Credit Cards: bit.ly/TopRewa...
11:47 - JEPI
15:19 - DIVO
18:22 - JEPQ
19:39 - Side by side comparison
How to transfer to M1 Finance: click.linksyne...
My dividend growth portfolio: m1.finance/1nn...
More about dividend growth investing:
Best High Dividend Schwab ETF: • Best High Dividend Sch...
Best High Dividend REIT Vanguard ETF: • Best High Dividend REI...
Best High Dividend Vanguard ETF to Retire Early: • Best High Dividend Van...
I'm not a financial advisor and the content discussed today is merely my opinion and intended only for your entertainment. The content expressed in this video should not be considered as professional financial advice. This video may contain links through which we are compensated when you click on or are approved for offers. The information in this video was not provided by any of the companies mentioned, and has not been reviewed, approved, or otherwise endorsed by any of these entities.
#DividendGrowthInvesting
Thanks for watching!
Try Seeking Alpha Premium: seekingalpha.me/dividendgrowthinvesting
Try M1 Finance: bit.ly/TryM1Finance
My favorite Rewards Credit Cards: bit.ly/TopRewardsCreditCards
I stick with JEPQ/JEPI its JP Morgan after all and no return of capital. All premiums and dividends paid out.
Same!
I agree with this video which is why i also hold JEPI/JEPQ. The new and up and coming cc fund by neos SPYI has the same characteristics of JEPI/JEPQ which is why i hold it along with SVOL
Yeah these are the best value for what you get in my opinion
Definitely SVOL
I can vouch for what Jake says. I’m long JEPQ / JEPI / SCHD as all of my holdings. They facilitate F.I.R.E. Plain and simple! 🔥
The simple path to wealth!!! Thanks for watching!!!
Same here... 75% SCHD, 12.5% JEPI, 12.5% JEPQ
Great video Jake, I really like SVOL very stable nice yield
Thanks!!! SVOL is a good alternative. Just watch the expense ratio and tax structure.
Hello, are you familiar with the yield shield concept in the FIRE community? Thank you
Can I skip DGRO and use only SCHD and supplement it with DIVO? To have higher % dividend yield
Yeah that could work. You will get a bit less diversification, but more income. It depends on your goals.
Using covered call limits uside growth from tracked asset. You may simply buy the ETF passively tracking the asset and sell lots from it for living, it'll still grow significantly higher than you're withdrowing and won't limit your upside growth.
Very informative! I sell covered calls manually on some of my stock holdings and I have a long time horizon so I don't have a need for covered call ETFs at the moment.
Yeah if you can write your own it can be a great way to increase your income. Especially in a flat or side ways market
What's your thoughts on COWZ, beside the high expense ratio of 0.49. Global X came out with the same etf (FLOW) but with a lower expense ratio of 0.25. A portfolio of schd, cowz(mid value), qqqm, avuv, jepq?
Cowz is not a bad choice. It pays quarterly that’s why it didn’t show up on my screener. Yeah if you can keep the ER low and they write out of the money options, you are going to likely do well.
@@DividendGrowthInvesting Forgot to mention that FLOW (0.25 ER) will be paying monthly compared to COWZ (0.49 ER) quarterly dividend.
What about using covered call ETF's in a tax sheltered account and using the monthly income to buy voo, schd, dgro etc?
Have you done any research into QQQY and JEPY selling cash secured puts? Would those be able to take more advantage of upside of the underlying vs covered call etf's? And I wanted to say thank you for such informative content! I always learn from your videos
I have 0 interest in them. Expense ratio is too high. I much prefer the ones discussed in this video.
The monthly yield of JEPQ is related to the the VIX, so those monthly comparisons aren't going to tell you anything except how volatile the market is at that time
Yea but keep in mind seasonality
Thanks for this video. Do you know of equivalent etf with CAD currency? Or anything similar in CAD?
I'd have to look into them. I only really know US ETFs
One more question. What is a good ratio for QQQM and JEPQ. One share of JEPQ for every QQQM or something else?
Depends on your goals and time horizon. Could be right or wrong in either direction. Depends on what your goals are.
It may already exist but i would love an etf that sells OOM calls and put for SPY. I will definitely do some looking in the next week or so. Yes i could do it but sometimes time is more valuable than money
Hey so ny questions could be a little off, but in your opinion what is a good field allocation for some reits? I have 10% of my total portfolio on real estate. Thanks for the great content!
Ideal would be to hold REITs in a Roth IRA. I like
No Jake, you’re wrong… Just kidding!😊
Lol 😀😀
Hey Jake, I was wondering why you are opposed to share accumulation of Jepi/jepq. For a 25 year time horizon . I have around 1000 shares now and my goal is 10,000. I enjoy I have these funds for the current dividends, holdings, and low beta. Jepq is currently 40% of my Roth IRA .
Its not ideal because your upside is capped in a bull market. Over 25 years, you would be greatly better off with just QQQ in most cases. The market goes up on average 8/10 of the time and you don't want to limit your upside growth potential. I know the tax free money sounds exciting, but in most cases, you are likely going to underperform - even with the tax savings.
Ideally you would want to grow your tax free account where you will get the highest return and then rebalance in 25 years and pay 0 taxes. For example, you could invest in growth, e.g. QQQ and in 25 years sell QQQ and buy JEPQ and you would likely have a higher portfolio value and at the time of rebalancing, a higher amount of income.
How do they recover after a sell off ?
Just found your channel, great video Jake, thanks! Would you be willing to share the % of your portfolio that's in JEPI, JEPQ, and SCHD? My husband and I are looking to FIRE in 2 years. When we retire, we're thinking of a portfolio that's about 20% covered call etfs, 15% SCHD, 10% BNDW, and the remaining 55% in a mix of growth stock ETFs.
Hi Jess! That is so exciting and I am so glad you found my channel! I remember when I was 2 years away from reaching FIRE.. It couldn't come fast enough!! I'm excited for you and your husband!
That is a lot of % allocated to growth ETFs. Are you planning on living off the income or selling your shares in retirement? It will be hard to live off the income unless you have a lot of money invested in them. You and your husband (and dog) look pretty young in your picture. You may want to consider having a dividend growth ETF like DGRO if you plan on living off your dividend portfolio. BNDW is a good bond fund. With interest rates so high, I personally prefer just having a reasonable % in a high yield savings account for my emergency fund and the rest in equities (compared to a small % in bonds), but just food for thought.
I talked about my portfolio in this recent video that you can watch here: ua-cam.com/video/ZL9uEQBhcao/v-deo.html
If you haven't already watched this video, this may be of use to you when thinking about the first year of reaching FIRE: ua-cam.com/video/xkGiVg5MjHk/v-deo.html
@@DividendGrowthInvesting Hi Jake! I appreciate the fast reply and thoughts! Indeed, FIRE will be awesome, glad you're rocking it already :) We're around your age, late 30s, still quite a long time to keep that money working though lol.
Fair point, and funny enough, the recent video you linked to is how I found you today. I didn't see the link to your portfolio, thanks for the viz! The reason why it's a large 55% allocation on the growth side ("growth" may have been a bit of a misleading word, it's mostly S&P 500 with some Small Cap Value and Semiconductor ETFs) is that we plan on doing a bit of a hybrid approach between 4% rule and all dividends. Plus we'd get income from a rental property.
Our goal is for 60% of our total living funds to come from dividends, 25% from selling "growth" stock etf shares, and 15% we'd get from the rental property.
Having said this, it is a bit riskier than sticking with purely all dividend stocks/ETFs. I agree that BNDW is decent, not amazing though, but everyone says to own bonds due to historically low correlation to stocks. Ugh, it's a toughie though, bonds have had a hard run recently.
Re: your second link, I don't know much about secured puts for income, I'll have to check that vid out, is that your Barista FIRE job?
Pffa.utg, infrastructure funds, preferred stocks,( if bought at right price) closed end funds with no return of capital are out there. There is a ETF for growth that has beaten the s&p index XLG. I’m doing the same thing as you in a Roth IRA . Keep up the great work!
If I could fulfill my OCD neuroticism by having a dividend coming every week that would be pretty cool
Lol I know the feeling
Im 50 right now, thinking of buying JEPQ, to add to my QQQM, VTI and VYM in my IRA portfolio, is JEPQ good to add at my age ? Or should stick to the 3 fund i have now and buy JEPQ later.
Is this something i should include/consider into my portfolio, if my time horizon is 20 yrs?
I would suggest staying away from all of these for now if you have a 20 year time horizon and consider them once you get closer to retirement.
Maybe I'm missing something but you mentioned that if your time horizon is greater than 5 years, covered calls should generally be avoided due to their lack of up side. Agreed, however, if we are holding our equities in a non-tax advantaged account so that we can access the funds before age 59.5, then that would mean that if we wished to get in on JEPI/JEPQ later on, we would need to liquidate something else and buy those ETFs or get a fat stack of cash and buy them.
It's a bit of a Predicament for us in our late 20s early 30s.
Hey there! I'm more talking about
@@DividendGrowthInvesting ah, duh. Overlooked that, thanks!
Love the video got a pension and maxed everything in roth for jepi to have fun money in about 12 years love it when market is unstable and just load more when market is boring
Best time to be dollar cost averaging in!
I really enjoy SPYI. Especially for their tax considerations.
IMO these C.C. etf's provide a lower total return vs selling covered calls and cash secured puts myself using SPY and/or QQQ. I spend 10 minutes on Mondays and Fridays managing my position, make a higher yield, and capture a higher upside of the market. I would recommend doing it yourself and then pay yourself the expense ratio. It's super easy to do. 🤟✌️👍
Yeah if you know how to write your own cc it has the potential to both under and overperform like anything else. You also have to take into account the time and tax implications of doing such a strategy on your own vs leaning on a low fee cc ETF like these.
Can you suggest any videos or programs for beginners on how to do that?
@@DividendGrowthInvesting The tax implications would be the same/similar to owing a C.C. ETF. As for time, once you know how to sell a call\put, it will only take you 10 minutes per week or per month depending on how long of a call\put you sell. It's super easy and you end up with more money or more growth depending on your execution plan.🤘🙏
@@itswhatever31 There are so many different videos on Y.T. about beginner Covered Calls. There is a channel titled "The Average Joe Investor", and he has made some easy to follow vids on this subject. 👍
As usual, great content.
Thank you!! 🙌
I keep saying this in many videos' comments section. I truly think UA-cam content creators are going to compare XYLG and QYLG to SCHD in the next 5-10 years.
The cc ETFs that write out of the money options are going to do well in my opinion.
@DividendGrowthInvesting I agree, but I think the design of the global YLGs 50% at the money and 50% held in each each respective index, will play sideways volatile and bull markets well. For example, I had roughly 6000$ in qylg which paid a 6-7% monthly payout, and rose to 20% in growth, which I had to unfortunately sell in July for use to pay for a plumbing repair. Between my QYLG sell off, my gold and silver and savings I was able to pay my 20,000$ excavation job without using debt...... AND my brokerage account QYLG was held in paid me a 50$ dividend that month. That inspired me to start the process over and buy fractional VTI. It's certainly cheaper to buy 1 share of QYLG VS owning 200 shares of QQQ throwing at the money calls on 100 shares while keeping the other 100 shares of qqq for growth.
No, expenses don't matter. Total net returns matter. Expenses matter when evaluating generic, passive index funds when there is no active management, and easily replicated or automated.
Does anyone here doing their option trading, covered call ETF’s, and taking short term capital gains on a taxable account? If so, are you also holding REIT’s on the taxable account since the taxation will be the same??? Humor me.
Take a look at this video on taxes that might help you: ua-cam.com/video/9_LX-ayAzo0/v-deo.html
@@DividendGrowthInvesting I watched and gave a 👍 long time ago hehe… The reason I asked this is to increase my income that I can use whenever I want to, that’s why I’m taking short term capital gains, but I have a dividend portfolio that pays qualified dividend that I plan to hold till retirement. Currently, I’m only making $30k annually, too low if you asks me. Therefore, I need to increase my income to keep up to inflation and overall expenses. The reason I asks this is I am thinking adding REIT’s on my taxable account since I’m doing short term capital gains anyway. When filing taxes, which one goes first to get tax, W-2 income or investment income? If I’m not mistaken, W-2 goes first, then having other income will goes next right? What do you think?
OTM options.. depends how much OTM😅
Lol ya 🤨
Ive noticed that QQQ and JEPQ almost mirror each other perfectly for a
There should be less movement in the price of JEPQ vs QQQ. It can also depend what day the fund managers write the month out call options.
Thats how covered calls work. If qqq goes up , jepq will lag behind
Hi
Hi :)
@@DividendGrowthInvesting what's up
Welcome to the dark side.
lol 🤓🤓🤓
@@DividendGrowthInvesting honestly, I've been waiting for your arrival
Keep up the great work Jake!! You are the man
Thanks man!!! Appreciating you stopping by!
First
There he is!!
@@DividendGrowthInvestingyou know how I do things
Any feedback on XYLD?
Not the biggest fan. I much prefer JEPI. Both track the SP500. Same thing with JEPQ vs QYLD.
Thanks for the feedback 😀
Thanks!
Thank you so much!!
So what’s your aggregate yield on cost?
Very well said
Thanks :)
Sadly in the UK we only have access to QYLD, the EU version too so it has low volume. Hopefully nearer to retirement for me (25+ years) there should be a lot more available. Cheers for the vid.
QYLD is an ok alternative especially if you don’t have access to the ones in this video.
Thanks for watching!!
You can combine
QYLD+QQQ= QYLG
JP Morgan introduced the JEPG A3EHRE in Europe (UCITS) just weeks ago.
The problem with CC etfs, is that once you stop reinvesting the divs, you start NAV erosion. What am I missing?
With most yes due to at the money options. Out of the money you gave growth potential
Tax drag for the high income funds needs to be highlighted. As well as the fact that investors would have more wealth for the same amount of income generated by simply holding and selling the respective indexes, SPY and QQQ.
In fact, if SPY or QQQ suffer too much for too long, the yields and total return for JEPI and JEPQ will follow suit. At the end of the day, you are capping upside substantially while still accepting almost all of the downside risk.
You still very well may reach your investment objectives, but the factors above should be understood before buying. You are likely leaving a lot of wealth on the table over both accumulation and retirement phases.
Very true! That’s why having a well balanced portfolio is so important
Maximize your in income, lower your total returns...lol
Depending on your time horizon they can be great tools to increase your yield. But ya very important to understand how these fit or don’t fit in a long term time horizon portfolio
I own DIVO, JEPQ, JEPI, TSLY.
Any tips on minimizing returns as well? Just in case I stack too many Benjamin’s.
I have magic beans I could sell you.