LU Dividend
Although LU has a dividend of 2.42 with an ex-dividend date of Jun 4, you can sell covered calls on Lufax Holding Ltd American Depositary Shares, each representing two (2) to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 12:20 PM ET):
| Lufax Holding Ltd American Depositary Shares, each representing two (2) (LU) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 4.56 |
4.57 |
4.57 |
-0.07 |
827K |
- |
0.0B |
LU Dividend-Like Income Using Covered Calls
With LU at 4.57, 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% |
0.14 |
0.0 |
| 5% |
0.23 |
0.1 |
| 10% |
0.46 |
0.1 |
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 LU Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| May 17 |
5.00 |
0.05 |
15 |
0.3 |
0.43 (9.4%) |
| Sep 20 |
5.00 |
0.50 |
141 |
0.4 |
0.43 (9.4%) |
| 5% Yield On LU Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| May 17 |
5.00 |
0.05 |
15 |
0.3 |
0.43 (9.4%) |
| Sep 20 |
5.00 |
0.50 |
141 |
0.4 |
0.43 (9.4%) |
| 10% Yield On LU Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| May 17 |
5.00 |
0.05 |
15 |
0.3 |
0.43 (9.4%) |
| Sep 20 |
5.00 |
0.50 |
141 |
0.4 |
0.43 (9.4%) |
Want to increase dividends with covered calls? Sign Up For A Free Trial
