"However, it's worth looking into ETFs like , KBW Premium Yield Equity REIT ETF (NASDAQ:KBWY ) , and iShares Emerging Markets Dividend ETF (NYSEARCA:DVYE ) if you want high yield without dealing with options. On the surface, options ETFs like JPMorgan Nasdaq Equity Premium Income (NASDAQ:JEPQ ) look like the best bet ever. You get a double-digit yield, you get to partake in the upside."
"The mania of options ETFs is unlikely to last too long. These ETFs do give partial upside exposure, but the moment the market stops rallying, you're in for a reality check. For example, ETFs writing covered calls for income are sacrificing exponential gains for linear income. It can get quite ugly when the market goes down, as you will absorb nearly of the underlying index's losses."
Monthly dividend exchange-traded funds have appeared offering extremely high yields, sometimes over 15%. Alternatives such as KBWY and DVYE provide high yield without options exposure. Options ETFs like JEPQ offer double-digit yields and partial upside participation, which can outperform traditional dividend ETFs during strong rallies. Covered-call and other options income strategies sacrifice exponential upside for linear income and can incur large losses when markets decline. Regulatory shifts such as a short-selling ban could severely harm these ETFs. A diversified approach into traditional high-yield dividend ETFs is recommended, including exposure to energy infrastructure through AMLP, which tracks the AMZI index.
Read at 24/7 Wall St.
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