TBT Dividend Type Payments
Although TBT has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on ProShares UltraShort Lehman 20 Year Treasury to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 1:20 PM ET):
| ProShares UltraShort Lehman 20 Year Treasury (TBT) | ||||||
|---|---|---|---|---|---|---|
| Bid | Ask | Last | Change | Volume | P/E | Market Cap |
| 34.01 | 34.34 | 34.16 | -0.28 | 245K | - | 0.7B |
TBT Dividend-Like Income Using Covered Calls
With TBT at 34.16, here's a table showing how big the annual "dividend" (i.e. 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% | 1.02 | 0.3 |
| 5% | 1.71 | 0.5 |
| 10% | 3.42 | 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 TBT Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Jan 16 | 35.00 | 0.25 | 24 | 1.0 | 0.66 (1.9%) | |
| Jun 18 | 35.00 | 1.45 | 177 | 0.8 | 0.66 (1.9%) | |
| 5% Yield On TBT Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Jan 16 | 35.00 | 0.25 | 24 | 1.0 | 0.66 (1.9%) | |
| Jun 18 | 35.00 | 1.45 | 177 | 0.8 | 0.66 (1.9%) | |
| 10% Yield On TBT Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Jan 16 | 35.00 | 0.25 | 24 | 1.0 | 0.66 (1.9%) | |
| Feb 20 | 35.00 | 0.65 | 59 | 1.1 | 0.66 (1.9%) | |
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| Top 10 Open Interest For Jan 16 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | NVDA dividend | 6. | SLV dividend | 1. | TMC dividend | |
| 2. | INTC dividend | 7. | GLD dividend | 2. | BHVN dividend | |
| 3. | TLT dividend | 8. | NIO dividend | 3. | DAWN dividend | |
| 4. | IBIT dividend | 9. | NFLX dividend | 4. | RARE dividend | |
| 5. | AAPL dividend | 10. | SPY dividend | 5. | TLRY dividend | |
Want more examples? TBPH Dividend | TBX Dividend
