REM Dividend Type Payments

iShares MTG REAL ESTATE CAPPED ETF dividend

Although REM has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares MTG REAL ESTATE CAPPED ETF 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):

iShares MTG REAL ESTATE CAPPED ETF (REM)
Bid Ask Last Change Volume P/E Market Cap
42.21 42.58 42.42 -0.06 200K - 11B

REM Dividend-Like Income Using Covered Calls

With REM at 42.42, 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% 1.27 0.3
5% 2.12 0.6
10% 4.24 1.2

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 REM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 43.00 0.25 29 0.9 0.42 (1.0%)
Jan 18 43.00 0.50 92 0.5 0.42 (1.0%)
5% Yield On REM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 43.00 0.25 29 0.9 0.42 (1.0%)

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Want more examples? RELL Dividend | REMX Dividend