FXB Dividend Type Payments

Invesco CurrencyShares British Pound Sterling Trust dividend

Although FXB has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Invesco CurrencyShares British Pound Sterling Trust to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 4:16 PM ET):

Invesco CurrencyShares British Pound Sterling Trust (FXB)
Bid Ask Last Change Volume P/E Market Cap
122.60 122.68 122.59 +0.23 17K - 0.0B

FXB Dividend-Like Income Using Covered Calls

With FXB at 122.59, 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% 3.68 1.0
5% 6.13 1.7
10% 12.26 3.4

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 FXB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 21 124.00 0.05 4 1.3 1.32 (1.1%)
Jan 18 126.00 0.40 32 1.3 3.32 (2.7%)
5% Yield On FXB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 21 123.00 0.30 4 7.5 0.32 (0.3%)
Jan 18 125.00 0.65 32 2.0 2.32 (1.9%)
10% Yield On FXB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 21 123.00 0.30 4 7.5 0.32 (0.3%)
Jan 18 123.00 1.40 32 4.4 0.32 (0.3%)

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