DFEN Dividend Type Payments
Although DFEN has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Direxion Daily Aerospace & Defense Bull 3X Shares 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):
| Direxion Daily Aerospace & Defense Bull 3X Shares (DFEN) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 30.65 |
32.27 |
32.27 |
+1.55 |
122K |
- |
0.0B |
DFEN Dividend-Like Income Using Covered Calls
With DFEN at 32.27, 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% |
0.97 |
0.3 |
| 5% |
1.61 |
0.4 |
| 10% |
3.23 |
0.9 |
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 DFEN Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Apr 17 |
32.43 |
0.85 |
49 |
1.7 |
0.16 (0.5%) |
| Oct 17 |
33.00 |
3.10 |
232 |
1.3 |
0.73 (2.3%) |
| 5% Yield On DFEN Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Apr 17 |
32.43 |
0.85 |
49 |
1.7 |
0.16 (0.5%) |
| Oct 17 |
33.00 |
3.10 |
232 |
1.3 |
0.73 (2.3%) |
| 10% Yield On DFEN Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Apr 17 |
32.43 |
0.85 |
49 |
1.7 |
0.16 (0.5%) |
| Oct 17 |
33.00 |
3.10 |
232 |
1.3 |
0.73 (2.3%) |
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