BAM Dividend

BROOKFIELD ASSET dividend

Although BAM has a dividend of 0.15 with an ex-dividend date of Aug 30, you can sell covered calls on BROOKFIELD ASSET to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Thu 4:16 PM ET):

BROOKFIELD ASSET (BAM)
Bid Ask Last Change Volume P/E Market Cap
43.26 44.41 43.80 +0.46 1.7M 16 42B

BAM Dividend-Like Income Using Covered Calls

With BAM at 43.80, here's a table showing how big the annual "dividend" (ie. total annual call premium received) would need to be to attain 3%, 5%, and 10% annual yields. Also shown is the equivalent number of cents/day necessary to achieve each yield:

Annual Yield Annual Premium Cents/Day
3% 1.31 0.4
5% 2.19 0.6
10% 4.38 1.2

So now we need to find out of the money covered calls that pay at least the prescribed cents/day amount of time premium. That will generate income and, because they are out of the money, leave room for some upside potential on the stock. Here are some examples:

3% Yield On BAM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 45.00 0.20 37 0.5 0.59 (1.3%)
Dec 21 45.00 0.95 128 0.7 0.59 (1.3%)
5% Yield On BAM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 21 45.00 0.95 128 0.7 0.59 (1.3%)
Mar 15 45.00 1.50 212 0.7 0.59 (1.3%)

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