The ETF that currently shows the highest trailing-12-month dividend yield among the listed monthly dividend payers is the JPMorgan Nasdaq Equity Premium Income ETF (JEPQ).
Investors often seek monthly dividend ETFs for a consistent income stream, providing more frequent payouts compared to quarterly or annual dividends. When evaluating these funds, the dividend yield is a key metric, indicating the income generated relative to the ETF's share price.
Top Monthly Dividend ETFs by Yield
Based on recent data, here's a comparison of several prominent monthly dividend ETFs and their trailing-12-month dividend yields:
| Monthly Dividend ETF | Trailing-12-month Dividend Yield |
|---|---|
| JPMorgan Nasdaq Equity Premium Income ETF (JEPQ) | 8.7% |
| First Trust Preferred Securities & Income ETF (FPE) | 5.7% |
| iShares 20+ Year Treasury Bond ETF (TLT) | 4.0% |
| Invesco S&P 500 High Dividend Low Volatility ETF (SPHD) | 3.4% |
As the table illustrates, the JPMorgan Nasdaq Equity Premium Income ETF (JEPQ) stands out with an 8.7% yield, making it the highest among this selection of monthly dividend ETFs.
Understanding JEPQ and High-Yield ETFs
The JPMorgan Nasdaq Equity Premium Income ETF (JEPQ) focuses on generating income through a strategy involving Nasdaq-listed equities and options. This approach typically involves selling call options on its equity holdings, which can generate a consistent stream of income, contributing to its higher dividend yield.
When considering high-yield ETFs, it's essential to understand that higher yields can sometimes be associated with different underlying strategies or risk profiles. Factors to consider include:
- Investment Strategy: High-yield ETFs often employ specific strategies like covered call writing (as seen with JEPQ) or investing in particular asset classes such as preferred stocks or high-yield bonds.
- Underlying Holdings: The types of assets the ETF invests in (e.g., tech stocks, utility stocks, bonds, preferred shares) will influence its yield and risk characteristics.
- Market Conditions: Dividend yields can fluctuate based on market performance, interest rates, and the financial health of the underlying companies or sectors.
For investors prioritizing monthly income, JEPQ presents a compelling option due to its leading yield. However, it is always advisable to conduct thorough research and consider how any investment aligns with personal financial goals and risk tolerance.
