Goldman Sachs' GPIX Outperforms JEPI with Higher Yield and Lower Fees

The JPMorgan Equity Premium Income ETF (NYSEARCA:JEPI) has been a popular choice for investors seeking a combination of equity exposure and regular income. JEPI pairs a defensive slice of large-cap U.S. stocks with an equity-linked note overlay that sells upside for premium income, at a 0.35% net expense ratio.

However, a newer competitor from Goldman Sachs has emerged in the form of the S&P 500 Premium Income ETF (NASDAQ:GPIX), which delivers the same core idea with some key differences. GPIX holds a replicated S&P 500 portfolio and directly writes short-dated call options on the index, covering roughly 25% to 75% of the notional value.

One of the main advantages of GPIX is its lower net expense ratio of 0.29%, which amounts to $60 per year retained by the investor rather than paid to the sponsor for a $100,000 position. Additionally, GPIX's distribution side favors it with a forward annualized dividend of $4.72428 against a $55.38 price, implying a forward yield near 8.53%.

Over the last twelve months, GPIX has posted a 19.44% adjusted return and a 10.22% year-to-date return, significantly outperforming JEPI's 11.18% return over the same period. The mechanism behind this outperformance is exposure quality, as GPIX's index replication keeps full participation in the mega-cap leaders that pulled the S&P 500 higher.