IEF Dividend Type Payments

Although IEF has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares 7-10 Year Treasury Bond ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 4:16 PM ET):

iShares 7-10 Year Treasury Bond ETF (IEF)
Bid	Ask	Last	Change	Volume	P/E	Market Cap
94.69	94.71	94.73	+0.33	5.2M	-	14B

IEF Dividend-Like Income Using Covered Calls

With IEF at 94.73, 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%	2.84	0.8
5%	4.74	1.3
10%	9.47	2.6

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 IEF Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Aug 1	94.50	0.61	12	3.3	0.00 (0.0%)
Aug 8	94.50	0.67	19	2.4	0.00 (0.0%)

5% Yield On IEF Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Aug 1	94.50	0.61	12	3.3	0.00 (0.0%)
Aug 8	94.50	0.67	19	2.4	0.00 (0.0%)

10% Yield On IEF Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Aug 1	94.50	0.61	12	3.3	0.00 (0.0%)
Jul 25	94.50	0.38	5	3.4	0.00 (0.0%)

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Want more examples? IDYA Dividend | IEFA Dividend