American Invest Hub
  • Politics
  • Investing
  • Business
  • Latest News

American Invest Hub

  • Politics
  • Investing
  • Business
  • Latest News
Business

JEPI forecast: will this covered call ETF rise or fall in 2025?

by admin January 6, 2025
January 6, 2025
JEPI forecast: will this covered call ETF rise or fall in 2025?

The JPMorgan Equity Premium Income ETF (JEPI) had a fairly strong performance in 2024 as American equities delivered double-digit gains. The fund, which is the biggest actively managed ETF, rose to a record high of $60.12 in December and then pulled back to the current $58. So, what is its outlook for 2025?

JPMorgan Equity Premium Income ETF 2024 review

The JEPI ETF had a good performance in 2024 as investors continued embracing high-dividend active ETFs. According to ETF, it had inflows in all months except August, when it had a net outflow of $21 million.

JEPI ETF inflows | Source: ETF.com

JEPI had a net inflow of over $5 billion in 2024, which brought its assets under management to over $37 billion. Investors love the fund because of its substantially high dividend yield of over 7%, which is higher than what other dividend funds are offering. The yield is also higher than what short and long-term government bonds offer.

However, JEPI’s investors were more badly off than those who allocated their cash to traditional assets like the S&P 500 and Nasdaq 100 indices. The fund’s stock rose by 5.75%, while the S&P 500 index jumped by 26% in the same period. 

JEPI’s total return, which includes dividends, was also weaker than the what the benchmark S&P 500 index offered. It rose by 13.80%, while the SPY ETF’s total return was 28%.

This performance was likely because JEPI’s gains are usually capped when the benchmark index is in a strong uptrend. 

For starters, JEPI is a covered call ETF that has two key dimensions. In the first step, the fund has invested in a group of companies that are members of the S&P 500 index. And in the next one, it has sold call options for the S&P 500 index. 

A call option gives the fund a right, but not the obligation to buy the S&P 500 at a certain strike price. The gains are usually capped when the index is in a strong uptrend and hits the strike price. 

JEPI ETF outlook for 2025

The JEPI ETF’s performance will depend on the overall trends in the stock market. Most Wall Street analyst expect that US equities will continue doing well this year, with those at Oppenheimer and UBS predicting that the S&P 500 index will hit $7,100 this year. The fund will likely do well if these estimates are correct. 

Analysts are citing the incoming Trump administration, which will focus on some friendly policies like tax cuts and deregulation. They also expect that the AI theme will continue to dominate the financial market during the year. 

However, I believe that the stock market will take a breather after rising for two consecutive years. For one, I expect that the recent AI tailwinds will start fading as the industry starts to slow. The most recent NVIDIA earnings showed that  the company’s growth was slowing.

There is also a risk that bond vigilantes will return as Trump focuses on unfunded tax cuts as we saw in the UK a few years ago.

JEPI ETF analysis

The daily chart shows that the JEPI peaked at $60.12 on December 2 and then retreated to $58, as I predicted. This retreat happened after the stock formed a rising wedge chart pattern, a popular bearish sign. It has moved below the lower side of the wedge at $59.9. 

The stock has formed a strong support at the 23.6% Fibonacci Retracement level at $56. It has also found support at the 200-day Exponential Moving Averages (EMA).

Therefore, the outlook for the JEPI ETF is mildly bearish, with the next point to watch being at $53, the 50% retracement point, which is about 7.7% below the current level.

The post JEPI forecast: will this covered call ETF rise or fall in 2025? appeared first on Invezz

0
FacebookTwitterGoogle +Pinterest
previous post
Rolls-Royce share price has a catalyst and a potential risk
next post
SCHD outlook for 2025: blue chip dividend ETF faces turbulence

Related Posts

Japan reports record $63B US trade surplus amid...

April 17, 2025

Infrastructure money is helping airports add toilets, gates...

March 27, 2024

Boop crypto surges 242% in 24 hours as...

May 2, 2025

Hang Seng index forms risky pattern as black...

November 4, 2024

Is Shopify stock price about to explode higher...

January 29, 2025

The DAX index just suffered a harsh reversal:...

December 20, 2024

From UK to US: how OpenAI is partnering...

July 22, 2025

Sam Altman accused by sister of sexual abuse,...

January 8, 2025

Charter, Cox to merge in mega deal to...

May 17, 2025

S&P 500 slips from intraday highs as investors...

January 26, 2025

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest News

    • How Donald Trump’s immigration crackdown may tank the labor market

      August 4, 2025
    • Trump’s tariff threat looms over India’s Russian oil deals

      August 4, 2025
    • Trump moves nuclear submarines near Russia: what triggered the move and what’s ahead

      August 3, 2025
    • BOE rate cuts offer little relief as UK households face mounting financial strain

      August 3, 2025
    • Retail investors shift focus to Europe as US valuations stretch

      August 3, 2025

    Categories

    • Business (3,583)
    • Investing (2,703)
    • Latest News (2,031)
    • Politics (1,530)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: americaninvesthub.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 americaninvesthub.com | All Rights Reserved