IWS Dividend Type Payments

iShares Russell Mid-cap Value ETF dividend

Although IWS has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares Russell Mid-cap Value 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 Value ETF (IWS)
Bid Ask Last Change Volume P/E Market Cap
141.08 143.27 142.96 -0.17 485K - 18B

IWS Dividend-Like Income Using Covered Calls

With IWS at 142.96, 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% 4.29 1.2
5% 7.15 2.0
10% 14.30 3.9

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 IWS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 15 143.00 4.00 152 2.5 0.00 (0.0%)
Jan 16 147.00 0.40 33 1.2 3.73 (2.6%)
5% Yield On IWS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 15 143.00 4.00 152 2.5 0.00 (0.0%)

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