Tax issues to consider when investing in covered call ETFs
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- 1Covered call ETFs can lead to unexpected tax issues due to capital gains distributions or return of capital (ROC).
- 2The 3-year tax cost ratio for the JPMorgan Equity Premium Income ETF (JEPI) is 3.11, which reduces after-tax returns.
- 3Edwin Letter said it is ideal for investors to purchase covered call ETFs within tax-deferred accounts.
So what's the key point?
Covered call ETFs can cause unexpected tax problems through things like capital gains distributions or return of capital (ROC).
Source CNBC · View original ↗
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