KRE Dividend Type Payments
Although KRE has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on SPDR S&P Regional Banking ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 4:16 PM ET):
| SPDR S&P Regional Banking ETF (KRE) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 55.89 |
55.96 |
56.04 |
-0.20 |
10.3M |
- |
3.5B |
KRE Dividend-Like Income Using Covered Calls
With KRE at 56.04, here's a table showing how big the annual "dividend" (i.e. 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% |
1.68 |
0.5 |
| 5% |
2.80 |
0.8 |
| 10% |
5.60 |
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 KRE Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Jun 6 |
56.00 |
1.47 |
33 |
4.5 |
0.04 (0.1%) |
| May 9 |
56.00 |
0.20 |
5 |
4.0 |
0.04 (0.1%) |
| 5% Yield On KRE Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Jun 6 |
56.00 |
1.47 |
33 |
4.5 |
0.04 (0.1%) |
| May 9 |
56.00 |
0.20 |
5 |
4.0 |
0.04 (0.1%) |
| 10% Yield On KRE Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Jun 6 |
56.00 |
1.47 |
33 |
4.5 |
0.04 (0.1%) |
| May 9 |
56.00 |
0.20 |
5 |
4.0 |
0.04 (0.1%) |
Want to increase dividends with covered calls? Sign Up For A Free Trial
