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 Thu 4:16 PM ET):
| iShares 20+ Year Treasury Bond ETF (TLT) | ||||||
|---|---|---|---|---|---|---|
| Bid | Ask | Last | Change | Volume | P/E | Market Cap |
| 91.36 | 91.37 | 91.34 | +0.68 | 39.1M | - | 11B |
TLT Dividend-Like Income Using Covered Calls
With TLT at 91.34, 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% | 2.74 | 0.8 |
| 5% | 4.57 | 1.3 |
| 10% | 9.13 | 2.5 |
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 | |
| Nov 7 | 91.00 | 1.29 | 23 | 4.0 | 0.00 (0.0%) | |
| Nov 14 | 91.00 | 1.48 | 30 | 3.7 | 0.00 (0.0%) | |
| 5% Yield On TLT Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Nov 7 | 91.00 | 1.29 | 23 | 4.0 | 0.00 (0.0%) | |
| Nov 14 | 91.00 | 1.48 | 30 | 3.7 | 0.00 (0.0%) | |
| 10% Yield On TLT Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Nov 7 | 91.00 | 1.29 | 23 | 4.0 | 0.00 (0.0%) | |
| Nov 14 | 91.00 | 1.48 | 30 | 3.7 | 0.00 (0.0%) | |
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| Top 10 Open Interest For Nov 21 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | KVUE dividend | 6. | HYG dividend | 1. | DBRG dividend | |
| 2. | IBIT dividend | 7. | GLD dividend | 2. | CRML dividend | |
| 3. | NVDA dividend | 8. | TLT dividend | 3. | PSO dividend | |
| 4. | SLV dividend | 9. | EEM dividend | 4. | ARCT dividend | |
| 5. | FXI dividend | 10. | INTC dividend | 5. | ABAT dividend | |
Want more examples? TLSA Dividend | TLTD Dividend
