MLPX Dividend Type Payments
Although MLPX has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Global X MLP & Energy Infrastructure ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 11:25 AM ET):
| Global X MLP & Energy Infrastructure ETF (MLPX) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 60.50 |
60.56 |
60.52 |
+0.61 |
61K |
- |
2.7B |
MLPX Dividend-Like Income Using Covered Calls
With MLPX at 60.52, 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% |
1.82 |
0.5 |
| 5% |
3.03 |
0.8 |
| 10% |
6.05 |
1.7 |
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 MLPX Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| May 16 |
61.00 |
0.95 |
15 |
6.3 |
0.44 (0.7%) |
| Sep 19 |
61.00 |
2.75 |
141 |
2.0 |
0.44 (0.7%) |
| 5% Yield On MLPX Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| May 16 |
61.00 |
0.95 |
15 |
6.3 |
0.44 (0.7%) |
| Sep 19 |
61.00 |
2.75 |
141 |
2.0 |
0.44 (0.7%) |
| 10% Yield On MLPX Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| May 16 |
61.00 |
0.95 |
15 |
6.3 |
0.44 (0.7%) |
| Sep 19 |
61.00 |
2.75 |
141 |
2.0 |
0.44 (0.7%) |
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