RSP Dividend Type Payments
Although RSP has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Invesco S&P 500 Equal Weight ETF 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):
| Invesco S&P 500 Equal Weight ETF (RSP) | ||||||
|---|---|---|---|---|---|---|
| Bid | Ask | Last | Change | Volume | P/E | Market Cap |
| 183.26 | 183.75 | 183.08 | +0.33 | 9.2M | 168 | 14B |
RSP Dividend-Like Income Using Covered Calls
With RSP at 183.08, 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% | 5.49 | 1.5 |
| 5% | 9.15 | 2.5 |
| 10% | 18.31 | 5.0 |
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 RSP Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Sep 5 | 183.00 | 1.20 | 29 | 1.6 | 0.00 (0.0%) | |
| Sep 12 | 183.00 | 1.40 | 36 | 1.8 | 0.00 (0.0%) | |
| 5% Yield On RSP Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Sep 12 | 184.00 | 1.00 | 36 | 2.8 | 0.25 (0.1%) | |
| Aug 15 | 184.00 | 0.40 | 8 | 5.0 | 0.25 (0.1%) | |
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| Top 10 Open Interest For Aug 15 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | NVDA dividend | 6. | GLD dividend | 1. | CAPR dividend | |
| 2. | SLV dividend | 7. | TSLA dividend | 2. | CORZ dividend | |
| 3. | SPY dividend | 8. | AMZN dividend | 3. | LQDA dividend | |
| 4. | IWM dividend | 9. | INTC dividend | 4. | VG dividend | |
| 5. | IBIT dividend | 10. | QQQ dividend | 5. | RCAT dividend | |
Want more examples? RSI Dividend | RTH Dividend
