Beyond JEPI: 2 Next-Gen Income ETFs That Are Quietly Outperforming JPMorgan's Crown Jewel in 2026

Core Insights - The article discusses two next-generation income ETFs, DIVO and IDVO, which are outperforming JPMorgan's JEPI in 2026, highlighting their different strategies for income generation and performance metrics [1][2]. Group 1: Performance Comparison - JEPI has delivered a cumulative return of 4.29% from January 2, 2026, to March 4, 2026, while the S&P 500 index has remained flat year-to-date [1]. - DIVO has outperformed JEPI with a cumulative total return of 5.22% over the same period [1]. - IDVO has achieved a year-to-date return of 6.92% through March 4, 2026, indicating strong performance compared to JEPI [2]. Group 2: Investment Strategies - JEPI utilizes a strategy that combines active stock selection with equity-linked notes (ELNs) to generate income, but it faces tax inefficiencies due to the nature of its income [1]. - DIVO focuses on high-quality large-cap companies with consistent dividend and earnings growth, generating income by selling covered calls on individual stocks rather than relying on ELNs [1]. - IDVO employs a similar strategy to DIVO but targets international stocks, using covered calls on individual securities from the MSCI ACWI ex U.S. Index [2]. Group 3: Expense Ratios and Yield - JEPI has an expense ratio of 0.35% and a 30-day SEC yield of 7.56%, but its income is primarily classified as ordinary income [1]. - DIVO has a higher expense ratio of 0.56% and a distribution rate of 4.79%, which is lower than JEPI's yield but has delivered stronger long-term returns [1]. - IDVO carries an expense ratio of 0.65% and expects a distribution yield of 6.08%, with income generated from both dividends and covered call premiums [2].