SDS Dividend Type Payments
Although SDS has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on ProShares UltraShort S&P500 to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 10:45 AM ET):
| ProShares UltraShort S&P500 (SDS) | ||||||
|---|---|---|---|---|---|---|
| Bid | Ask | Last | Change | Volume | P/E | Market Cap |
| 34.58 | 34.59 | 34.59 | -0.25 | 927K | - | 0.0B |
SDS Dividend-Like Income Using Covered Calls
With SDS at 34.59, 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% | 1.04 | 0.3 |
| 5% | 1.73 | 0.5 |
| 10% | 3.46 | 0.9 |
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 SDS Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Mar 1 | 37.00 | 0.03 | 8 | 0.4 | 2.41 (7.0%) | |
| Mar 8 | 38.00 | 0.05 | 15 | 0.3 | 3.41 (9.9%) | |
| 5% Yield On SDS Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Mar 1 | 36.50 | 0.06 | 8 | 0.8 | 1.91 (5.5%) | |
| Mar 8 | 37.50 | 0.10 | 15 | 0.7 | 2.91 (8.4%) | |
| 10% Yield On SDS Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Mar 1 | 36.00 | 0.10 | 8 | 1.3 | 1.41 (4.1%) | |
| Mar 8 | 36.50 | 0.17 | 15 | 1.1 | 1.91 (5.5%) | |
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| Top 10 Open Interest For Mar 15 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | SPX dividend | 6. | EWZ dividend | 1. | CRON dividend | |
| 2. | EEM dividend | 7. | GE dividend | 2. | AMRN dividend | |
| 3. | SPY dividend | 8. | LLY dividend | 3. | PCG dividend | |
| 4. | QQQ dividend | 9. | BAC dividend | 4. | ROKU dividend | |
| 5. | FXI dividend | 10. | GLD dividend | 5. | FIT dividend | |
Want more examples? SDRL Dividend | SDT Dividend
