NIO Dividend Type Payments
Although NIO has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on NIO Inc. American depositary shares, each representing one Class A ordi 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):
| NIO Inc. American depositary shares, each representing one Class A ordi (NIO) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 7.41 |
7.43 |
7.42 |
+0.17 |
54.3M |
- |
8.1B |
NIO Dividend-Like Income Using Covered Calls
With NIO at 7.42, 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% |
0.22 |
0.1 |
| 5% |
0.37 |
0.1 |
| 10% |
0.74 |
0.2 |
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 NIO Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 5 |
10.00 |
0.13 |
33 |
0.4 |
2.57 (34.6%) |
| Nov 7 |
7.50 |
0.16 |
5 |
3.2 |
0.07 (0.9%) |
| 5% Yield On NIO Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 5 |
10.00 |
0.13 |
33 |
0.4 |
2.57 (34.6%) |
| Nov 7 |
7.50 |
0.16 |
5 |
3.2 |
0.07 (0.9%) |
| 10% Yield On NIO Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 5 |
10.00 |
0.13 |
33 |
0.4 |
2.57 (34.6%) |
| Nov 7 |
7.50 |
0.16 |
5 |
3.2 |
0.07 (0.9%) |
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