FDRR Dividend Type Payments
Although FDRR has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Fidelity Dividend ETF for Rising Rates to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Thu 9:45 AM ET):
| Fidelity Dividend ETF for Rising Rates (FDRR) | ||||||
|---|---|---|---|---|---|---|
| Bid | Ask | Last | Change | Volume | P/E | Market Cap |
| 51.78 | 51.90 | 51.79 | +0.35 | 2K | - | 0.0B |
FDRR Dividend-Like Income Using Covered Calls
With FDRR at 51.79, 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% | 1.55 | 0.4 |
| 5% | 2.59 | 0.7 |
| 10% | 5.18 | 1.4 |
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 FDRR Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| May 16 | 52.00 | 0.75 | 149 | 0.5 | 0.10 (0.2%) | |
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| Top 10 Open Interest For Dec 20 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | NVDA dividend | 6. | EEM dividend | 1. | NMRA dividend | |
| 2. | SPY dividend | 7. | IWM dividend | 2. | RGTI dividend | |
| 3. | XLF dividend | 8. | TLT dividend | 3. | FDX dividend | |
| 4. | QQQ dividend | 9. | TSLA dividend | 4. | WULF dividend | |
| 5. | FXI dividend | 10. | KWEB dividend | 5. | QBTS dividend | |
Want more examples? FDP Dividend | FDS Dividend
