KRE Dividend Type Payments
Although KRE has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on SPDR S&P Regional Banking 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):
| SPDR S&P Regional Banking ETF (KRE) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 60.47 |
60.60 |
60.60 |
+0.20 |
10.3M |
- |
3.7B |
KRE Dividend-Like Income Using Covered Calls
With KRE at 60.60, 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% |
1.82 |
0.5 |
| 5% |
3.03 |
0.8 |
| 10% |
6.06 |
1.7 |
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 KRE Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 27 |
61.00 |
0.05 |
5 |
1.0 |
0.40 (0.7%) |
| Jan 3 |
64.00 |
0.12 |
12 |
1.0 |
3.40 (5.6%) |
| 5% Yield On KRE Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 27 |
61.00 |
0.05 |
5 |
1.0 |
0.40 (0.7%) |
| Jan 3 |
64.00 |
0.12 |
12 |
1.0 |
3.40 (5.6%) |
| 10% Yield On KRE Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 27 |
62.00 |
0.14 |
5 |
2.8 |
1.40 (2.3%) |
| Jan 10 |
60.50 |
1.20 |
19 |
5.8 |
0.00 (0.0%) |
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