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 Fri 1:00 PM ET):

VANGUARD SM-CAP ETF (VB)
Bid Ask Last Change Volume P/E Market Cap
161.00 161.05 161.07 +0.31 120K - 916B

VB Dividend-Like Income Using Covered Calls

With VB at 161.07, 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% 4.83 1.3
5% 8.05 2.2
10% 16.11 4.4

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
Sep 21 163.00 0.60 36 1.7 1.95 (1.2%)
Dec 21 165.00 2.15 127 1.7 3.95 (2.5%)
5% Yield On VB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 162.00 0.95 36 2.6 0.95 (0.6%)
Dec 21 163.00 3.30 127 2.6 1.95 (1.2%)
10% Yield On VB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 161.00 1.75 36 4.7 0.00 (0.0%)

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Top 10 Open Interest For Sep 21 Expiration     Top 5 High Yield
1.EEM dividend 6.GE dividend   1.UVXY dividend
2.SPY dividend 7.GLD dividend   2.AKRX dividend
3.SPX dividend 8.FB dividend   3.LB dividend
4.QQQ dividend 9.IWM dividend   4.COTY dividend
5.XLF dividend 10.GDX dividend   5.TSLA dividend

Want more examples? VAW Dividend | VBIV Dividend