VB Dividend Type Payments

Vanguard Sm-Cap ETF dividend

Although VB has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Vanguard Sm-Cap ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 12:25 PM ET):

Vanguard Sm-Cap ETF (VB)
Bid Ask Last Change Volume P/E Market Cap
153.66 153.71 153.67 -0.08 144K - 0.0B

VB Dividend-Like Income Using Covered Calls

With VB at 153.67, 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% 4.61 1.3
5% 7.68 2.1
10% 15.37 4.2

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 VB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Apr 18 158.00 0.45 32 1.4 4.29 (2.8%)
Jun 21 160.00 1.25 96 1.3 6.29 (4.1%)
5% Yield On VB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Apr 18 157.00 0.70 32 2.2 3.29 (2.1%)
Jun 21 157.00 2.35 96 2.4 3.29 (2.1%)
10% Yield On VB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Apr 18 155.00 1.40 32 4.4 1.29 (0.8%)

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Top 10 Open Interest For Apr 18 Expiration     Top 5 High Yield
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Want more examples? VAW Dividend | VBIV Dividend