JPMorgan’s Nasdaq Equity Premium Income ETF underperformed the Nasdaq-100 by nearly 8% due to its covered-call approach and higher fees.
JPMorgan Nasdaq Equity Premium Income ETF (JEPQ) has underperformed Invesco QQQ Trust (QQQ) by nearly eight percentage points over the past year. The fund’s covered-call strategy, designed to generate monthly income, caps upside potential compared to direct Nasdaq-100 exposure.
JEPQ’s expense ratio of 0.35% exceeds QQQ’s 0.20% and QQQM’s 0.15%, compounding costs over time. On a $10,000 investment, the 0.20% difference could erode hundreds of dollars in returns over two decades at an 8% annual growth rate.
As volatility declines, JEPQ’s monthly payouts are shrinking, while the 10-year Treasury yield at 4.38% narrows its income advantage over risk-free assets. The fund’s performance gap highlights the trade-off between yield and capital appreciation.