ITB Dividend Type Payments

I SHARES US HOME CONSTRUCTION dividend

Although ITB has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on I SHARES US HOME CONSTRUCTION to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 3:30 PM ET):

I SHARES US HOME CONSTRUCTION (ITB)
Bid Ask Last Change Volume P/E Market Cap
38.90 38.91 38.91 +1.43 2.8M - 12B

ITB Dividend-Like Income Using Covered Calls

With ITB at 38.91, 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% 1.17 0.3
5% 1.95 0.5
10% 3.89 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 ITB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 24 39.50 0.05 4 1.3 0.59 (1.5%)
Aug 31 40.00 0.05 11 0.5 1.09 (2.8%)
5% Yield On ITB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 24 39.50 0.05 4 1.3 0.59 (1.5%)
Aug 31 39.50 0.20 11 1.8 0.59 (1.5%)
10% Yield On ITB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 24 39.50 0.05 4 1.3 0.59 (1.5%)
Aug 31 39.50 0.20 11 1.8 0.59 (1.5%)

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