SPXS Dividend Type Payments
Although SPXS has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Direxion Daily S&P 500 Bear 3X 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 500 Bear 3X (SPXS) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 5.95 |
5.95 |
5.94 |
-0.18 |
52.6M |
- |
0.1B |
SPXS Dividend-Like Income Using Covered Calls
With SPXS at 5.94, 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% |
0.18 |
0.0 |
| 5% |
0.30 |
0.1 |
| 10% |
0.59 |
0.2 |
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 SPXS Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Feb 7 |
6.00 |
0.21 |
22 |
1.0 |
0.05 (0.8%) |
| Feb 14 |
6.00 |
0.23 |
29 |
0.8 |
0.05 (0.8%) |
| 5% Yield On SPXS Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Feb 7 |
6.00 |
0.21 |
22 |
1.0 |
0.05 (0.8%) |
| Feb 14 |
6.00 |
0.23 |
29 |
0.8 |
0.05 (0.8%) |
| 10% Yield On SPXS Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Feb 7 |
6.00 |
0.21 |
22 |
1.0 |
0.05 (0.8%) |
| Feb 14 |
6.00 |
0.23 |
29 |
0.8 |
0.05 (0.8%) |
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