LABU Dividend Type Payments

Although LABU has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on DIREXION DAILY S&P BIOTECH BULL to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 4:00 PM ET):

DIREXION DAILY S&P BIOTECH BULL (LABU)
Bid Ask Last Change Volume P/E Market Cap
73.29 73.40 73.31 -0.54 2.0M - 3.8B

LABU Dividend-Like Income Using Covered Calls

With LABU at 73.31, 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% 2.20 0.6
5% 3.67 1.0
10% 7.33 2.0

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 LABU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 81.00 0.05 3 1.7 7.60 (10.4%)
Oct 26 88.50 0.10 10 1.0 15.10 (20.6%)
5% Yield On LABU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 81.00 0.05 3 1.7 7.60 (10.4%)
Oct 26 87.50 0.15 10 1.5 14.10 (19.2%)
10% Yield On LABU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 80.00 0.15 3 5.0 6.60 (9.0%)
Oct 26 85.00 0.30 10 3.0 11.60 (15.8%)

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Top 10 Open Interest For Oct 19 Expiration     Top 5 High Yield
1.SPY dividend 6.PBR dividend   1.CLVS dividend
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5.BAC dividend 10.AMD dividend   5.SKX dividend

Want more examples? LABL Dividend | LAD Dividend