FEX Dividend Type Payments

Although FEX has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on First Trust Lg-Cap Core AlphaDEX Fund to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 10:35 AM ET):

First Trust Lg-Cap Core AlphaDEX Fund (FEX)
Bid Ask Last Change Volume P/E Market Cap
53.53 53.56 53.55 +0.55 18K - 0.0B

FEX Dividend-Like Income Using Covered Calls

With FEX at 53.55, 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% 1.61 0.4
5% 2.68 0.7
10% 5.36 1.5

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 FEX Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 18 54.00 0.30 31 1.0 0.44 (0.8%)
Mar 15 55.00 0.50 87 0.6 1.44 (2.7%)
5% Yield On FEX Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 18 54.00 0.30 31 1.0 0.44 (0.8%)
Mar 15 54.00 1.05 87 1.2 0.44 (0.8%)

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Want more examples? FEU Dividend | FEYE Dividend