UBT Dividend Type Payments

PROSHARES ULTRA 20+ YEAR TREASURY dividend

Although UBT has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on PROSHARES ULTRA 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 Thu 4:16 PM ET):

PROSHARES ULTRA 20+ YEAR TREASURY (UBT)
Bid Ask Last Change Volume P/E Market Cap
67.20 67.28 67.25 0.00 34K - 0.2B

UBT Dividend-Like Income Using Covered Calls

With UBT at 67.25, 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% 2.02 0.6
5% 3.36 0.9
10% 6.73 1.8

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 UBT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 71.00 0.20 30 0.7 3.72 (5.5%)
Jan 18 73.00 0.55 93 0.6 5.72 (8.5%)
5% Yield On UBT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 70.00 0.40 30 1.3 2.72 (4.0%)
Jan 18 71.00 1.00 93 1.1 3.72 (5.5%)
10% Yield On UBT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 69.00 0.70 30 2.3 1.72 (2.6%)
Jan 18 68.00 2.05 93 2.2 0.72 (1.1%)

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