Investors are chasing income from stocks and bonds, and have created some new winners and new experiments in the exchange-traded fund market. The industry’s top performer is the JPMorgan Equity Premium Income ETF (JEPI), which returned a top 11% as the fund’s strategy of using dividend stocks and selling call options paid off when markets fell and investors sought safety. The fund currently has more than $20 billion in assets under management. But JEPI is not the only popular fund. The Amplify CWP Enhanced Dividend Income ETF (DIVO), which uses a covered call strategy, has attracted more than $1.6 billion in fund flows over the past year, while the equity-only approach of the Schwab US Dividend Equity ETF (SCHD). raked in over $13 billion. Both funds have had positive total returns over the past 12 months, with distribution yields higher than the S&P 500. The start of 2023 has proven to be a different market than 2022, and there are a number of new ETFs targeting the market that offer more approaches to investors. investors looking for income. Here are some strategies that can get you big this year. International income One area where investors can look is the international market, which has outperformed the US in the opening weeks of 2023. Both Amplify and Schwab offer international versions of their yield funds – Amplify International Enhanced Dividend Income ETF (IDVO) and Schwab International Dividend Equity ETF real-time stock quotes, SCHY. Amplify’s international fund, which launched in September, still has less than $20 million in assets but has seen $12 million in inflows since the beginning of the year. The Schwab fund has raked in over $100 million in 2023. “So we started, I think, to see some legs there, partly spurred by the alpha of the international market,” said Christian Magoon, CEO of Amplify ETFs. Investing in international dividend stocks can be a bit tricky for investors, as distribution schedules and different currency impacts can make cash flows a bit more unpredictable than in a US portfolio. “We are trying to pass through the income as the fund receives it. It’s really about setting the right expectations for investors … helping people understand that there is a bit more lumpiness to the income stream,” said David Botset, head of equity product management and innovation at Schwab Asset Management. Fixed income funds Another area where investors can pay is fixed income. While interest rates have moved higher again after economic reports showed a resilient labor market and potentially sticky inflation, many strategists expect a Fed rate hike to peak this year. That means investors can buy high-yield products and then, if the central bank starts to cut rates, benefit from the bond market rally. Bond yields and prices move inversely to each other. “This is a once-in-a-year opportunity to de-risk, rebalance, return to fixed income,” said Stephen Laipply, Head of US iShares Fixed Income ETF. The fixed income ETF market is smaller than the equity ETF market, and 2023 could continue to grow in new categories. For example, some collateralized loan obligation funds have been opened in recent months Another growth area could be multi-sector funds, which can have active management to navigate the continued volatility in the bond market. Capital Group US Multi-Sector Income ETF (CGMS), for example, has surpassed $80 million in assets under management after launching in October and has a 30-day SEC yield of about 6%. “Multi-sector is one example of a category that is very popular in mutual funds and almost non-existent in ETFs,” said Holly Framstedt, director of ETFs at Capital Group. Other options strategies There are also funds in the market that combine fixed income and options strategies. In August, BlackRock’s iShares launched a series of BuyWrite ETFs covering long-term Treasurys ( TLTW ), high-yield corporate debt ( HYGW ) and investment-grade corporate debt ( LQDW ). Because the fund sells call options on the underlying ETF, it may benefit from a “longer” rate environment where the Fed isn’t cutting rates anytime soon. “If you believe that we’re going to land somewhere in this range, that’s probably pretty good,” Laipply said. “I feel the same way about mortgages.”