FGSI vs PEPS

FGSIDFT Vest Growth Strength & Target Income ETF

PEPSBParametric Equity Plus ETF

In short

FGSI Most S&P 500 covered-call funds sell calls on the index they own. FGSI owns roughly 50 growth-and-quality screened US stocks and writes calls on the S&P 500 instead, aiming for monthly income at a set spread over the index dividend yield.

PEPS Active management at index-fund pricing. PEPS holds a U.S. large-cap base, then writes S&P 500 calls against offsetting long exposure: a beta-neutral overlay built to add return rather than swap upside for income.

Stated mandate

FGSI The Fund seeks current income first and capital appreciation second. It primarily holds U.S. exchange-traded stocks selected to track The Growth StrengthTM Index and sells U.S.-traded calls on the S&P 500® Index or ETFs tracking it.

PEPS The Fund seeks long-term capital appreciation. It is actively managed, using a U.S. large-cap equity base and beta-neutral call overwriting on the S&P 500 with offsetting long exposure to seek incremental total return.

Why people hold it

• FGSI The income goal is written into the prospectus: an annual rate 8% above the S&P 500's current dividend yield, paid out monthly.sec.gov
• The equity sleeve isn't a plain index tracker. Roughly 50 US stocks screened for growth, profitability and quality via First Trust's Growth Strength Index.ftportfolios.com
• Because the calls sit on the S&P 500 rather than on its own shares, no individual holding gets called away, though index moves still drive the option leg.sec.gov

• PEPS 0.10% is index-fund pricing for an actively managed strategy. Even the cheap, well-regarded active peers cost more: DFAU at 0.12%, FELC at 0.18%.
• Not a covered-call fund. The sold S&P 500 calls are paired with offsetting long exposure, so the overlay seeks incremental total return instead of capping upside.
• Ordinary 1940 Act ETF wrapper, U.S. large-cap equity, distributions paid quarterly. The complexity lives in the overlay, not the tax paperwork.
• Cost is the standout: the typical active U.S. equity ETF in this group charges several times what PEPS does, and fee drag is the one input you know in advance.

Worth knowing

• FGSI At 0.85% a year it costs more than the typical S&P 500 options-income fund, where the median is nearer 0.60% and big peers like IVVW and GPIX charge a fraction of that.sec.gov
• It launched in mid-2025 and is still a small, lightly traded fund, so trading costs can run wider than in the category's established names.
• First Trust discloses that distributions may include return of capital, meaning part of a payout can be capital coming back rather than income earned.sec.gov

• PEPS Launched in November 2024. The overlay has not yet run through a full market cycle, so there is limited history to judge it on.
• A small, thinly traded fund. Bid-ask spreads can run wider than a mega-cap index ETF's, which shows up most on larger orders.
• The options leg adds moving parts: short index calls lose value in a sharp rally, and the offsetting long exposure is what has to make that back.

Full FGSI profile⁠

Full PEPS profile⁠