IVW Dividend Type Payments

iShares S&P 500 Growth ETF dividend

Although IVW has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares S&P 500 Growth ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 1:15 PM ET):

iShares S&P 500 Growth ETF (IVW)
Bid Ask Last Change Volume P/E Market Cap
100.57 100.59 100.55 +3.49 1.5M - 36B

IVW Dividend-Like Income Using Covered Calls

With IVW at 100.55, 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% 3.02 0.8
5% 5.03 1.4
10% 10.06 2.8

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 IVW Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 17 101.00 5.60 159 3.5 0.41 (0.4%)
Jul 18 101.00 3.20 68 4.7 0.41 (0.4%)
5% Yield On IVW Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 17 101.00 5.60 159 3.5 0.41 (0.4%)
Jul 18 101.00 3.20 68 4.7 0.41 (0.4%)
10% Yield On IVW Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 17 101.00 5.60 159 3.5 0.41 (0.4%)
Jul 18 101.00 3.20 68 4.7 0.41 (0.4%)

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