IWR Dividend Type Payments

iShares Russell Mid-Cap ETF dividend

Although IWR has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares Russell Mid-Cap 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 Russell Mid-Cap ETF (IWR)
Bid Ask Last Change Volume P/E Market Cap
94.20 96.25 95.27 +1.25 1.4M - 24B

IWR Dividend-Like Income Using Covered Calls

With IWR at 95.27, 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% 2.86 0.8
5% 4.76 1.3
10% 9.53 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 IWR Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 15 100.00 1.70 215 0.8 3.75 (3.9%)
Feb 20 100.00 1.05 131 0.8 3.75 (3.9%)
5% Yield On IWR Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 15 96.00 3.60 215 1.6 0.00 (0.0%)
Feb 20 96.00 3.00 131 2.1 0.00 (0.0%)

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