SDS Dividend Type Payments

PROSHARES ULTRA-SHORT S&P 500 dividend

Although SDS has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on PROSHARES ULTRA-SHORT S&P 500 to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 12:50 PM ET):

PROSHARES ULTRA-SHORT S&P 500 (SDS)
Bid Ask Last Change Volume P/E Market Cap
35.61 35.62 35.62 +0.60 4.7M - 18B

SDS Dividend-Like Income Using Covered Calls

With SDS at 35.62, 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% 1.07 0.3
5% 1.78 0.5
10% 3.56 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 SDS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 17 38.00 0.01 3 0.3 2.38 (6.7%)
Aug 24 41.00 0.03 10 0.3 5.38 (15.1%)
5% Yield On SDS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 17 37.50 0.03 3 1.0 1.88 (5.3%)
Aug 24 40.00 0.05 10 0.5 4.38 (12.3%)
10% Yield On SDS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 17 37.50 0.03 3 1.0 1.88 (5.3%)
Aug 24 38.00 0.12 10 1.2 2.38 (6.7%)

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Top 10 Open Interest For Aug 17 Expiration     Top 5 High Yield
1.SPY dividend 6.XLF dividend   1.UVXY dividend
2.EEM dividend 7.FB dividend   2.NVDA dividend
3.QQQ dividend 8.FXI dividend   3.JWN dividend
4.SPX dividend 9.GLD dividend   4.AMAT dividend
5.BAC dividend 10.AABA dividend   5.DBD dividend

Want more examples? SDR Dividend | SDT Dividend