TLH Dividend Type Payments

iShares 10-20 Year Treasury Bond ETF dividend

Although TLH has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares 10-20 Year Treasury Bond 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 10-20 Year Treasury Bond ETF (TLH)
Bid Ask Last Change Volume P/E Market Cap
101.65 101.71 101.60 -0.26 1.3M - 0.4B

TLH Dividend-Like Income Using Covered Calls

With TLH at 101.60, 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% 3.05 0.8
5% 5.08 1.4
10% 10.16 2.8

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 TLH Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jun 18 102.00 2.10 140 1.5 0.29 (0.3%)
Sep 18 102.00 2.75 232 1.2 0.29 (0.3%)
5% Yield On TLH Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jun 18 102.00 2.10 140 1.5 0.29 (0.3%)
Feb 20 102.00 0.60 22 2.7 0.29 (0.3%)

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