IAI Dividend Type Payments

iShares U.S. Broker-Dealers & Securities Exchanges ETF dividend

Although IAI has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares U.S. Broker-Dealers & Securities Exchanges ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 4:16 PM ET):

iShares U.S. Broker-Dealers & Securities Exchanges ETF (IAI)
Bid Ask Last Change Volume P/E Market Cap
125.36 128.86 128.02 -0.43 52K - 0.4B

IAI Dividend-Like Income Using Covered Calls

With IAI at 128.02, 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% 3.84 1.1
5% 6.40 1.8
10% 12.80 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 IAI Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 15 129.00 1.75 57 3.1 0.14 (0.1%)
Jan 17 130.00 2.75 120 2.3 1.14 (0.9%)
5% Yield On IAI Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 15 129.00 1.75 57 3.1 0.14 (0.1%)
Jan 17 130.00 2.75 120 2.3 1.14 (0.9%)

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Want more examples? IAG Dividend | IAK Dividend