DBB Dividend Type Payments

Invesco DB Base Metals Fund dividend

Although DBB has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Invesco DB Base Metals Fund to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 10:45 AM ET):

Invesco DB Base Metals Fund (DBB)
Bid Ask Last Change Volume P/E Market Cap
24.20 24.22 24.18 -0.03 102K - 0.4B

DBB Dividend-Like Income Using Covered Calls

With DBB at 24.18, here's a table showing how big the annual "dividend" (i.e. 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% 0.73 0.2
5% 1.21 0.3
10% 2.42 0.7

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 DBB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 16 25.00 0.05 4 1.3 0.78 (3.2%)
Jul 17 25.00 0.60 186 0.3 0.78 (3.2%)
5% Yield On DBB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 16 25.00 0.05 4 1.3 0.78 (3.2%)
Feb 20 25.00 0.40 39 1.0 0.78 (3.2%)
10% Yield On DBB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 16 25.00 0.05 4 1.3 0.78 (3.2%)
Feb 20 25.00 0.40 39 1.0 0.78 (3.2%)

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Want more examples? DBAW Dividend | DBC Dividend