VV Dividend Type Payments

Vanguard Large-Cap ETF dividend

Although VV has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Vanguard Large-Cap 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):

Vanguard Large-Cap ETF (VV)
Bid Ask Last Change Volume P/E Market Cap
305.77 309.10 307.00 +1.56 255K - 17B

VV Dividend-Like Income Using Covered Calls

With VV at 307.00, 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% 9.21 2.5
5% 15.35 4.2
10% 30.70 8.4

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 VV Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 310.00 6.00 64 9.4 0.90 (0.3%)
Nov 21 310.00 3.50 36 9.7 0.90 (0.3%)
5% Yield On VV Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 310.00 6.00 64 9.4 0.90 (0.3%)
Nov 21 310.00 3.50 36 9.7 0.90 (0.3%)
10% Yield On VV Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 310.00 6.00 64 9.4 0.90 (0.3%)
Nov 21 310.00 3.50 36 9.7 0.90 (0.3%)

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