JEPI (JPMorgan Equity Premium Income) and JEPQ (JPMorgan Nasdaq Equity Premium Income) are sister funds from the same manager using similar strategies but targeting different market segments. Understanding their differences helps investors choose the right fit.
JEPI: The Defensive Choice
- Underlying: Actively selected low-volatility S&P 500 stocks
- Strategy: 80% equities + 20% equity-linked notes (ELNs)
- Yield: Typically 7-9%
- Volatility: Lower than S&P 500 (beta ~0.65)
- Best For: Conservative income seekers, retirees, bear market protection
JEPQ: The Growth-Income Hybrid
- Underlying: Actively selected Nasdaq 100 stocks (tech-heavy)
- Strategy: Similar ELN approach as JEPI
- Yield: Typically 9-12%
- Volatility: Higher than JEPI due to tech exposure
- Best For: Investors wanting income with more growth potential
Key Differences
| Factor | JEPI | JEPQ |
|---|---|---|
| Sector Focus | Defensive/Value | Technology/Growth |
| Yield | Lower | Higher |
| Volatility | Lower | Higher |
| Bull Market | Lags more | Captures more |
| Bear Market | Outperforms | Underperforms |
Which Should You Choose?
Choose JEPI if: You prioritize stability, are in or near retirement, want lower volatility, or believe we're heading into a bear market.
Choose JEPQ if: You have a longer time horizon, want higher income potential, can tolerate volatility, or believe tech will continue outperforming.
Many investors hold both for diversification - JEPI as a defensive anchor and JEPQ for enhanced income and growth exposure.
Frequently Asked Questions
Should I own both JEPI and JEPQ?
Are JEPI and JEPQ taxes the same?
Is JEPI or JEPQ better for a bear market?
DivAgent Educational Standards
This definition is part of the DivAgent Income Academy curriculum. Our glossary is designed to bridge the gap between institutional jargon and retail investor understanding. Each term is reviewed by our Research Team for accuracy, specifically in the context of:
- Tax implications (Ordinary vs. Qualified)
- Impact on Total Return calculations
- Relevance to Option-Income strategies
- Risk assessment in a retirement portfolio
*While we strive for precision, financial terminology can evolve. Always verify definitions with official regulatory sources (SEC, IRS) when making tax or legal decisions.