EZU Dividend Type Payments

iShares MSCI EUROZONE ETF dividend

Although EZU has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares MSCI EUROZONE ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 12:50 PM ET):

iShares MSCI EUROZONE ETF (EZU)
Bid Ask Last Change Volume P/E Market Cap
39.63 39.64 39.63 -0.86 4.4M - 106B

EZU Dividend-Like Income Using Covered Calls

With EZU at 39.63, 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% 1.19 0.3
5% 1.98 0.5
10% 3.96 1.1

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 EZU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 17 40.00 0.05 3 1.7 0.36 (0.9%)
Sep 21 41.00 0.20 38 0.5 1.36 (3.4%)
5% Yield On EZU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 17 40.00 0.05 3 1.7 0.36 (0.9%)
Sep 21 40.00 0.65 38 1.7 0.36 (0.9%)
10% Yield On EZU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 17 40.00 0.05 3 1.7 0.36 (0.9%)
Sep 21 40.00 0.65 38 1.7 0.36 (0.9%)

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Want more examples? EZSTR Dividend | EZV Dividend