LABU Dividend Type Payments
Although LABU has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Direxion Daily S&P Biotech Bull 3X Shares 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):
| Direxion Daily S&P Biotech Bull 3X Shares (LABU) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 99.60 |
100.00 |
99.62 |
-18.54 |
3.5M |
- |
0.1B |
LABU Dividend-Like Income Using Covered Calls
With LABU at 99.62, 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% |
2.99 |
0.8 |
| 5% |
4.98 |
1.4 |
| 10% |
9.96 |
2.7 |
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 LABU Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 6 |
100.00 |
7.55 |
22 |
34.3 |
0.00 (0.0%) |
| Dec 13 |
100.00 |
7.60 |
29 |
26.2 |
0.00 (0.0%) |
| 5% Yield On LABU Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 6 |
100.00 |
7.55 |
22 |
34.3 |
0.00 (0.0%) |
| Dec 13 |
100.00 |
7.60 |
29 |
26.2 |
0.00 (0.0%) |
| 10% Yield On LABU Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 6 |
100.00 |
7.55 |
22 |
34.3 |
0.00 (0.0%) |
| Dec 13 |
100.00 |
7.60 |
29 |
26.2 |
0.00 (0.0%) |
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