SKF Dividend Type Payments

PROSHARES ULTRA-SHORT FINANCIAL dividend

Although SKF has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on PROSHARES ULTRA-SHORT FINANCIAL to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 2:00 PM ET):

PROSHARES ULTRA-SHORT FINANCIAL (SKF)
Bid Ask Last Change Volume P/E Market Cap
20.69 20.73 20.70 -0.22 8K - 0.3B

SKF Dividend-Like Income Using Covered Calls

With SKF at 20.70, 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% 0.62 0.2
5% 1.04 0.3
10% 2.07 0.6

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 SKF Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 28.00 0.05 29 0.2 7.27 (35.1%)
Dec 21 28.00 0.12 64 0.2 7.27 (35.1%)
5% Yield On SKF Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 24.00 0.11 29 0.4 3.27 (15.8%)
Dec 21 26.00 0.21 64 0.3 5.27 (25.5%)
10% Yield On SKF Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 22.00 0.35 29 1.2 1.27 (6.1%)
Dec 21 23.00 0.49 64 0.8 2.27 (11.0%)

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Want more examples? SJW Dividend | SKIS Dividend