VSS Dividend Type Payments

Although VSS has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Vanguard FTSE All-Wld ex-US SmCp Idx ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 3:00 PM ET):

Vanguard FTSE All-Wld ex-US SmCp Idx ETF (VSS)
Bid Ask Last Change Volume P/E Market Cap
125.02 125.10 125.06 +0.72 67K - 0.0B

VSS Dividend-Like Income Using Covered Calls

With VSS at 125.06, 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% 3.75 1.0
5% 6.25 1.7
10% 12.51 3.4

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 VSS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 15 125.00 0.75 43 1.5 0.00 (0.0%)
Oct 18 126.00 0.30 15 2.0 0.90 (0.7%)
5% Yield On VSS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 18 126.00 0.30 15 2.0 0.90 (0.7%)

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