ZROZ Dividend Type Payments
Although ZROZ has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on PIMCO 25 Year Zero Coupon U.S. Treasury Index Exchange-Traded Fund 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):
PIMCO 25 Year Zero Coupon U.S. Treasury Index Exchange-Traded Fund (ZROZ) |
Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
76.17 |
76.31 |
76.38 |
-0.61 |
237K |
- |
0.0B |
ZROZ Dividend-Like Income Using Covered Calls
With ZROZ at 76.38, 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% |
2.29 |
0.6 |
5% |
3.82 |
1.0 |
10% |
7.64 |
2.1 |
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 ZROZ Using Covered Calls |
Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
Nov 15 |
76.00 |
1.90 |
36 |
4.4 |
0.00 (0.0%) |
Oct 18 |
76.00 |
0.70 |
8 |
4.9 |
0.00 (0.0%) |
5% Yield On ZROZ Using Covered Calls |
Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
Nov 15 |
76.00 |
1.90 |
36 |
4.4 |
0.00 (0.0%) |
Oct 18 |
76.00 |
0.70 |
8 |
4.9 |
0.00 (0.0%) |
10% Yield On ZROZ Using Covered Calls |
Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
Nov 15 |
76.00 |
1.90 |
36 |
4.4 |
0.00 (0.0%) |
Oct 18 |
76.00 |
0.70 |
8 |
4.9 |
0.00 (0.0%) |
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