RDY Dividend Type Payments
Although RDY has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on DR Reddy Labs to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 4:16 PM ET):
| DR Reddy Labs (RDY) | ||||||
|---|---|---|---|---|---|---|
| Bid | Ask | Last | Change | Volume | P/E | Market Cap |
| 35.50 | 41.18 | 37.74 | -0.33 | 266K | - | 0.0B |
RDY Dividend-Like Income Using Covered Calls
With RDY at 37.74, 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% | 1.13 | 0.3 |
| 5% | 1.89 | 0.5 |
| 10% | 3.77 | 1.0 |
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 RDY Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Jun 21 | 45.00 | 0.85 | 197 | 0.4 | 3.82 (10.1%) | |
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| Top 10 Open Interest For Dec 21 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | SPY dividend | 6. | IWM dividend | 1. | dividend | |
| 2. | EEM dividend | 7. | FXI dividend | 2. | dividend | |
| 3. | SPX dividend | 8. | GE dividend | 3. | dividend | |
| 4. | QQQ dividend | 9. | USO dividend | 4. | dividend | |
| 5. | EWZ dividend | 10. | VXX dividend | 5. | dividend | |
Want more examples? RDWR Dividend | RE Dividend
