XMHQ Dividend Type Payments
Although XMHQ has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Invesco S&P MidCap Quality 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):
| Invesco S&P MidCap Quality ETF (XMHQ) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 86.90 |
89.88 |
88.36 |
+0.67 |
691K |
- |
0.1B |
XMHQ Dividend-Like Income Using Covered Calls
With XMHQ at 88.36, 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% |
2.65 |
0.7 |
| 5% |
4.42 |
1.2 |
| 10% |
8.84 |
2.4 |
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 XMHQ Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| May 16 |
90.00 |
0.60 |
30 |
2.0 |
0.12 (0.1%) |
| Sep 19 |
90.00 |
4.00 |
156 |
2.6 |
0.12 (0.1%) |
| 5% Yield On XMHQ Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| May 16 |
90.00 |
0.60 |
30 |
2.0 |
0.12 (0.1%) |
| Sep 19 |
90.00 |
4.00 |
156 |
2.6 |
0.12 (0.1%) |
| 10% Yield On XMHQ Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Sep 19 |
90.00 |
4.00 |
156 |
2.6 |
0.12 (0.1%) |
| Jun 20 |
90.00 |
2.60 |
65 |
4.0 |
0.12 (0.1%) |
Want to increase dividends with covered calls? Sign Up For A Free Trial
