VPU Dividend Type Payments

Vanguard Util ETF dividend

Although VPU has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Vanguard Util ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 11:25 AM ET):

Vanguard Util ETF (VPU)
Bid Ask Last Change Volume P/E Market Cap
127.10 127.15 127.04 +0.61 58K - 0.0B

VPU Dividend-Like Income Using Covered Calls

With VPU at 127.04, 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% 3.81 1.0
5% 6.35 1.7
10% 12.70 3.5

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 VPU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Mar 15 130.00 0.25 22 1.1 2.85 (2.2%)
Apr 18 129.00 1.15 56 2.1 1.85 (1.5%)
5% Yield On VPU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Mar 15 129.00 0.50 22 2.3 1.85 (1.5%)
Apr 18 129.00 1.15 56 2.1 1.85 (1.5%)
10% Yield On VPU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Mar 15 128.00 0.90 22 4.1 0.85 (0.7%)

Want to increase dividends with covered calls?  Sign Up For A Free Trial

 
 
Top 10 Open Interest For Mar 15 Expiration     Top 5 High Yield
1.SPX dividend 6.EWZ dividend   1.CRON dividend
2.EEM dividend 7.GE dividend   2.FIT dividend
3.SPY dividend 8.LLY dividend   3.KPTI dividend
4.QQQ dividend 9.BAC dividend   4.IMGN dividend
5.FXI dividend 10.GLD dividend   5.ASND dividend

Want more examples? VPL Dividend | VQT Dividend