XSD Dividend Type Payments
Although XSD has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on State Street SPDR S&P Semiconductor ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 4:16 PM ET):
| State Street SPDR S&P Semiconductor ETF (XSD) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 345.86 |
351.10 |
348.01 |
+0.11 |
46K |
- |
1.5B |
XSD Dividend-Like Income Using Covered Calls
With XSD at 348.01, 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% |
10.44 |
2.9 |
| 5% |
17.40 |
4.8 |
| 10% |
34.80 |
9.5 |
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 XSD Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Jan 16 |
350.00 |
2.80 |
5 |
34.0 |
0.00 (0.0%) |
| Apr 17 |
350.00 |
24.50 |
96 |
24.4 |
0.00 (0.0%) |
| 5% Yield On XSD Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Jan 16 |
350.00 |
2.80 |
5 |
34.0 |
0.00 (0.0%) |
| Apr 17 |
350.00 |
24.50 |
96 |
24.4 |
0.00 (0.0%) |
| 10% Yield On XSD Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Jan 16 |
350.00 |
2.80 |
5 |
34.0 |
0.00 (0.0%) |
| Apr 17 |
350.00 |
24.50 |
96 |
24.4 |
0.00 (0.0%) |
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