TLT Dividend Type Payments
Although TLT has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares 20+ Year Treasury Bond 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):
iShares 20+ Year Treasury Bond ETF (TLT) | ||||||
---|---|---|---|---|---|---|
Bid | Ask | Last | Change | Volume | P/E | Market Cap |
98.89 | 98.90 | 98.88 | -0.38 | 36.6M | - | 13B |
TLT Dividend-Like Income Using Covered Calls
With TLT at 98.88, 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% | 2.97 | 0.8 |
5% | 4.94 | 1.4 |
10% | 9.89 | 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 TLT Using Covered Calls | ||||||
---|---|---|---|---|---|---|
Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
Oct 4 | 100.00 | 0.44 | 15 | 2.9 | 1.10 (1.1%) | |
Oct 11 | 100.00 | 0.68 | 22 | 3.1 | 1.10 (1.1%) |
5% Yield On TLT Using Covered Calls | ||||||
---|---|---|---|---|---|---|
Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
Oct 4 | 100.00 | 0.44 | 15 | 2.9 | 1.10 (1.1%) | |
Oct 11 | 100.00 | 0.68 | 22 | 3.1 | 1.10 (1.1%) |
10% Yield On TLT Using Covered Calls | ||||||
---|---|---|---|---|---|---|
Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
Oct 4 | 100.00 | 0.44 | 15 | 2.9 | 1.10 (1.1%) | |
Oct 11 | 100.00 | 0.68 | 22 | 3.1 | 1.10 (1.1%) |
Want to increase dividends with covered calls? Sign Up For A Free Trial
Top 10 Open Interest For Oct 18 Expiration | Top 5 High Yield | |||||
---|---|---|---|---|---|---|
1. | NVDA dividend | 6. | SLV dividend | 1. | RLAY dividend | |
2. | IWM dividend | 7. | GLD dividend | 2. | LUNR dividend | |
3. | SPY dividend | 8. | TLT dividend | 3. | MARA dividend | |
4. | QQQ dividend | 9. | EEM dividend | 4. | CPRI dividend | |
5. | HYG dividend | 10. | AAPL dividend | 5. | MBLY dividend |
Want more examples? TLSA Dividend | TLTD Dividend