HYG Dividend Type Payments

Although HYG has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares iBoxx $ High Yield Corporate Bond ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 9:35 AM ET):

iShares iBoxx $ High Yield Corporate Bond ETF (HYG)
Bid	Ask	Last	Change	Volume	P/E	Market Cap
80.98	80.99	80.98	-0.06	290K	-	15B

HYG Dividend-Like Income Using Covered Calls

With HYG at 80.98, 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%	2.43	0.7
5%	4.05	1.1
10%	8.10	2.2

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 HYG Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Feb 6	81.00	0.23	24	1.0	0.01 (0.0%)
Feb 13	81.00	0.25	31	0.8	0.01 (0.0%)

5% Yield On HYG Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Jan 16	81.00	0.07	3	2.3	0.01 (0.0%)
Jan 23	81.00	0.14	10	1.4	0.01 (0.0%)

10% Yield On HYG Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Jan 16	81.00	0.07	3	2.3	0.01 (0.0%)

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Want more examples? HYEM Dividend | HYGH Dividend