DBP Dividend Type Payments

INVESCO DB PRECIOUS METALS dividend

Although DBP has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on INVESCO DB PRECIOUS METALS to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Thu 9:45 AM ET):

INVESCO DB PRECIOUS METALS (DBP)
Bid Ask Last Change Volume P/E Market Cap
34.22 34.25 34.22 +0.22 1K - 2.6B

DBP Dividend-Like Income Using Covered Calls

With DBP at 34.22, 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% 1.03 0.3
5% 1.71 0.5
10% 3.42 0.9

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 DBP Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 18 35.00 0.55 156 0.4 0.75 (2.2%)

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Top 10 Open Interest For Aug 17 Expiration     Top 5 High Yield
1.SPY dividend 6.XLF dividend   1.NVDA dividend
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3.QQQ dividend 8.FXI dividend   3.JWN dividend
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