TMV Dividend Type Payments
Although TMV has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Direxion Daily 20-Year Treasury Bear 3X to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 4:16 PM ET):
Direxion Daily 20-Year Treasury Bear 3X (TMV) |
Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
39.92 |
39.94 |
39.98 |
+0.06 |
2.3M |
- |
0.1B |
TMV Dividend-Like Income Using Covered Calls
With TMV at 39.98, 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% |
1.20 |
0.3 |
5% |
2.00 |
0.5 |
10% |
4.00 |
1.1 |
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 TMV Using Covered Calls |
Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
Apr 26 |
40.00 |
0.55 |
4 |
13.8 |
0.06 (0.2%) |
May 17 |
40.00 |
1.75 |
25 |
7.0 |
0.06 (0.2%) |
5% Yield On TMV Using Covered Calls |
Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
Apr 26 |
40.00 |
0.55 |
4 |
13.8 |
0.06 (0.2%) |
May 17 |
40.00 |
1.75 |
25 |
7.0 |
0.06 (0.2%) |
10% Yield On TMV Using Covered Calls |
Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
Apr 26 |
40.00 |
0.55 |
4 |
13.8 |
0.06 (0.2%) |
May 17 |
40.00 |
1.75 |
25 |
7.0 |
0.06 (0.2%) |
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