IVW Dividend Type Payments

iShares S&P 500 GROWTH INDEX dividend

Although IVW has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares S&P 500 GROWTH INDEX to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Thu 4:16 PM ET):

iShares S&P 500 GROWTH INDEX (IVW)
Bid Ask Last Change Volume P/E Market Cap
165.64 167.75 166.41 -3.09 1.2M - 210B

IVW Dividend-Like Income Using Covered Calls

With IVW at 166.41, 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% 4.99 1.4
5% 8.32 2.3
10% 16.64 4.6

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 IVW Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 172.00 0.65 30 2.2 4.25 (2.6%)
Jan 18 176.00 1.45 93 1.6 8.25 (5.0%)
5% Yield On IVW Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 171.00 0.90 30 3.0 3.25 (2.0%)
Jan 18 171.00 2.75 93 3.0 3.25 (2.0%)
10% Yield On IVW Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 169.00 1.95 30 6.5 1.25 (0.8%)
Jan 18 169.00 4.40 93 4.7 1.25 (0.8%)

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Want more examples? IVV Dividend | IVZ Dividend