IEFA Dividend Type Payments

Although IEFA has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares Core MSCI EAFE ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 4:16 PM ET):

Bid Ask Last Change Volume P/E Market Cap
57.00 60.69 59.57 +0.85 6.4M - 0.0B

IEFA Dividend-Like Income Using Covered Calls

With IEFA at 59.57, 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% 1.79 0.5
5% 2.98 0.8
10% 5.96 1.6

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 IEFA Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jun 21 61.00 0.80 127 0.6 0.31 (0.5%)
Sep 20 61.00 1.30 218 0.6 0.31 (0.5%)

Want to increase dividends with covered calls?  Sign Up For A Free Trial

Top 10 Open Interest For Mar 15 Expiration     Top 5 High Yield
1.SPX dividend 6.EWZ dividend   1.ICPT dividend
2.EEM dividend 7.GE dividend   2.ROKU dividend
3.SPY dividend 8.XOP dividend   3.KPTI dividend
4.FXI dividend 9.BAC dividend   4.BHC dividend
5.QQQ dividend 10.JD dividend   5.VKTX dividend

Want more examples? IEF Dividend | IEI Dividend