Summary of Better ETF to BUY: SCHD or JEPQ?

00:00:00 - 00:10:00

The video compares two popular dividend-focused ETFs , SCHD and JEPQ, amidst current market volatility, emphasizing their different investment strategies and performances. SCHD tracks the Dow Jones US Dividend 100 Index and emphasizes fundamental analysis, boasting a strong ten-year total return of 183% and consistent dividend growth of 3.7%. In contrast, JEPQ utilizes a covered call strategy to generate higher yields, showing a significant recent performance increase of nearly 50% since its inception in May 2022, though it has underperformed SCHD over a longer period. The speaker expresses a preference for SCHD due to its reliable dividends and tech exposure, arguing that it aligns better with a long-term investment approach, while recognizing that JEPQ might attract those seeking immediate higher yields. The discussion encourages viewers to consider their individual investment strategies when selecting between the two ETFs.

• 00:00:00 In this section, the discussion highlights the current market panic and the potential for building wealth during downturns, specifically focusing on two popular dividend-focused ETFs: SCHD and JEPQ. SCHD follows a traditional ETF model, tracking the Dow Jones US Dividend 100 Index and selecting stocks based on an algorithm assessing fundamentals and sustainability, while JEPQ employs a more active strategy, generating higher yields through the sale of out-of-the-money covered calls. The video compares both ETFs, emphasizing their differing approaches and highlighting performances since JEPQ's inception in May 2022, where JEPQ has outperformed SCHD in total returns, despite the overall small sample size of comparison. The presenter encourages viewers to consider the unique strategies of each ETF and their respective investment philosophies.
• 00:05:00 In this section, the comparison between two ETFs, SCHD and JEPQ, is discussed, highlighting their performance and investment strategies. JEPQ has seen a nearly 50% increase recently, while SCHD has risen only 15%, although SCHD boasts a ten-year total return of 183%, averaging 18% annually, and has historically outperformed the S&P 500. The covered call strategy employed by JEPQ provides initial income but caps upside potential, making it suitable for sideways or down markets. The section also outlines the top holdings of both ETFs and emphasizes SCHD's advantages in dividend yield and growth, showcasing a 3.7% yield and consistent dividend increases over the past 13 years. Ultimately, the choice between SCHD for long-term investments and JEPQ for short-term trading will depend on individual investor strategies and preferences.
• 00:10:00 In this section, the speaker discusses their preference for the SCHD ETF over JEPQ, highlighting three primary reasons for this choice. They appreciate SCHD's tech exposure, which complements broader market investments despite its relative lack of tech companies. Additionally, they value its consistent, reliable, and growing dividends that enhance compounding potential. While acknowledging that some investors, such as retirees, may favor JEPQ for its higher yield, the speaker emphasizes their long-term investment strategy focused on both share price appreciation and dividend growth with SCHD. They invite viewer interaction concerning ETF preferences and encourage engagement with their content.