USO Dividend Type Payments
Although USO has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on United States Oil Fund to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 11:40 AM ET):
| United States Oil Fund (USO) | ||||||
|---|---|---|---|---|---|---|
| Bid | Ask | Last | Change | Volume | P/E | Market Cap |
| 74.07 | 74.08 | 74.08 | +0.60 | 2.5M | - | 1.2B |
USO Dividend-Like Income Using Covered Calls
With USO at 74.08, 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% | 2.22 | 0.6 |
| 5% | 3.70 | 1.0 |
| 10% | 7.41 | 2.0 |
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 USO Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Feb 6 | 100.00 | 0.34 | 24 | 1.4 | 25.92 (35.0%) | |
| Feb 13 | 100.00 | 0.50 | 31 | 1.6 | 25.92 (35.0%) | |
| 5% Yield On USO Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Feb 6 | 100.00 | 0.34 | 24 | 1.4 | 25.92 (35.0%) | |
| Feb 13 | 100.00 | 0.50 | 31 | 1.6 | 25.92 (35.0%) | |
| 10% Yield On USO Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Feb 6 | 74.00 | 3.35 | 24 | 13.6 | 0.00 (0.0%) | |
| Feb 13 | 74.00 | 3.65 | 31 | 11.5 | 0.00 (0.0%) | |
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| Top 10 Open Interest For Jan 16 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | NVDA dividend | 6. | SLV dividend | 1. | CRVS dividend | |
| 2. | IBIT dividend | 7. | SPY dividend | 2. | TMQ dividend | |
| 3. | TLT dividend | 8. | NFLX dividend | 3. | ENVX dividend | |
| 4. | INTC dividend | 9. | QQQ dividend | 4. | IMNM dividend | |
| 5. | AAPL dividend | 10. | GLD dividend | 5. | SBET dividend | |
Want more examples? USNA Dividend | USPH Dividend
