JP Morgan Asset Management (JPMAM) has expanded its suite of premium income ETFs with the launch of a US equity premium income ETF and a Nasdaq equity premium income active ETF, ETF Stream can reveal.
The JPMorgan US Equity Premium Income Active UCITS ETF (JEPI) and the JPMorgan Nasdaq Equity Premium Income Active UCITS ETF (JEPQ) are listed on the London Stock Exchange, both with total expense ratios (TER) of 0.35%.
Both ETFs’ distribution share class have also listed on Deutsche Borse and SIX today, while the accumulating share classes have listed on Deutsche Borse, Borsa Italiana, and SIX today.
Both launches are UCITS iterations of the hugely successful US-listed strategies. The US versions of JEPI and JEPQ have amassed $36.6bn and $17.6bn, respectively, since launching in May 2020 and May 2022.
JEPI will have an expected yield of 7–9% a year, aiming to provide less volatility versus its benchmark index, the S&P 500.
Meanwhile, JEPQ will have an expected yield of 9–11% a year and will contain a “fundamentally driven Nasdaq 100 portfolio.”
Each ETF applies an options strategy led by JPMAM’s US Core investment team, headed by JPMAM CIO for US core equity and head of US derivatives Hamilton Reiner.
The team sells index options weekly on the equity portfolios of JEPI and JEPQ generating income from the option premiums. These premiums, along with dividends from the underlying equities, are paid out monthly.
Travis Spence (pictured), global head of ETFs at JPMAM, said: "We're thrilled to be expanding our Equity Premium Income range in UCITS with the launch of JEPI and JEPQ. These innovative and market-leading strategies, which have seen strong demand in the US, offer investors a compelling solution for achieving their income and total return objectives with reduced volatility. “
The third ETF in the range, the JPMorgan Global Equity Premium Income Active UCITS ETF (JEPG) – which launched in December last year – is shortlisted for ‘Most Innovative ETF Launch’ in ETF Stream’s ETF Awards 2024.
