J.P. Morgan Expands in Canada With New Currency-Hedged Income ETFs

TORONTO, ON – May 04, 2026 – J.P. Morgan Asset Management (JPMAM) is deepening its commitment to the Canadian market with the launch of two new exchange-traded funds (ETFs) designed to shield investors from currency fluctuations while generating income from U.S. equities. The firm announced today the debut of the JPMorgan US Equity Premium Income Active ETF – CAD Hedged (TSX: JEPH) and the JPMorgan Nasdaq Equity Premium Income Active ETF – CAD Hedged (TSX: JPQH) on the Toronto Stock Exchange.

These new offerings are Canadian-dollar hedged versions of the firm’s widely popular U.S.-listed strategies, JEPI and JEPQ. The launch aims to address a persistent challenge for Canadian investors: how to access the lucrative U.S. stock market and its income opportunities without seeing returns eroded by an unfavorable shift in the Canada-U.S. exchange rate.

"We are pleased to offer the Canadian hedged versions of our equity premium income strategies to support investors seeking income generation while retaining equity exposure in today's dynamic markets," said Travis Hughes, Head of Canada at J.P. Morgan Asset Management. "The launch of JEPH and JPQH expands access to our premium income ETF lineup and provides an option for investors to balance currency exposure."

An Active Approach to Income and Risk

At the core of JEPH and JPQH is an actively managed strategy known as "equity premium income." This approach is designed to deliver a one-two punch: participation in the growth of U.S. stocks combined with a consistent stream of income. The strategy is built on two pillars. First, the funds invest in a portfolio of U.S. stocks, with JEPH focusing on the broader S&P 500 universe and JPQH targeting the tech-heavy Nasdaq-100. The managers actively select stocks they believe have lower volatility and attractive valuations.

Second, and central to the income objective, the ETFs employ an options-based overlay. They generate a significant portion of their yield by selling call options against their respective indices. This is primarily achieved through investments in Equity-Linked Notes (ELNs), which embed the covered call strategy. By selling these options, the funds collect premiums, which are then distributed to investors as monthly income. This is the engine behind the high yields that have made their U.S. counterparts, JEPI and JEPQ, multi-billion dollar funds, often boasting yields in the high single or even double digits.

However, this income comes with a trade-off. The covered call strategy effectively caps the upside potential of the funds. In a roaring bull market where stocks are rising rapidly, these ETFs are likely to underperform a standard index fund because the gains on the underlying stocks are limited by the sold call options. Conversely, the income generated from the options premiums can provide a cushion in flat or moderately down markets, making the strategy attractive to those prioritizing income and lower volatility over capturing maximum market growth.

The Currency Hedging Imperative

For Canadian investors, allocating capital to the U.S. introduces an additional layer of risk: currency volatility. If the Canadian dollar strengthens against the U.S. dollar, the value of U.S. investments decreases when converted back into loonies, regardless of how well the underlying assets have performed. This can significantly eat into total returns.

JEPH and JPQH are designed to neutralize this specific risk. By using financial instruments like forward contracts, the funds aim to lock in an exchange rate, effectively stripping out the impact of currency movements. The result is a return profile that more closely mirrors the performance of the underlying U.S. income strategy itself. This feature is particularly valuable for income-focused investors, such as retirees, who depend on predictable cash flow and wish to minimize unexpected volatility from foreign exchange markets.

"Currency considerations can play an important role in portfolio construction for Canadian financial advisors and investors," noted Jay Rana, Head of Canadian Advisor Business at J.P. Morgan Asset Management. "By offering Canadian hedged versions of JEPI and JEPQ, we are providing advisors with additional flexibility to incorporate these income-focused strategies into client portfolios."

Navigating a Competitive Landscape

J.P. Morgan Asset Management is not the first to offer hedged, income-generating ETFs in Canada. The firm enters a competitive and well-established market dominated by players like BMO Global Asset Management, which has been a pioneer in covered call ETFs for over a decade with products such as the BMO US High Dividend Covered Call Hedged to CAD ETF (ZWS). Other firms, including Harvest Portfolios, Invesco, and Fidelity, also offer a range of solutions aimed at generating high income from U.S. and global equities, many with currency-hedged options.

Where JPMAM aims to differentiate itself is through its active management expertise and the specific structure of its funds. Unlike some strategies that systematically write options on their entire portfolio, the JEPI and JEPQ strategies utilize a combination of direct stock ownership and ELNs, which provides the managers with flexibility. The firm is banking on its global research capabilities and brand recognition to attract assets in this crowded field. The competitive management fees of the underlying strategies also position them to compete effectively against incumbent products.

This launch marks another significant step in JPMAM's strategic expansion into the Canadian ETF market, a push that began in 2024. With the addition of JEPH and JPQH, the firm’s Canadian-listed ETF lineup now stands at 11, spanning fixed income, international equities, and now, sophisticated income solutions. This steady rollout of products signals a long-term commitment to becoming a major force in the Canadian asset management industry, providing local investors and advisors with access to its global investment platforms.