PDD Dividend Type Payments
Although PDD has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on PDD Holdings Inc. - American Depositary Shares to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 3:25 PM ET):
| PDD Holdings Inc. - American Depositary Shares (PDD) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 100.83 |
100.84 |
100.84 |
+0.22 |
4.4M |
38 |
126B |
PDD Dividend-Like Income Using Covered Calls
With PDD at 100.84, 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% |
3.03 |
0.8 |
| 5% |
5.04 |
1.4 |
| 10% |
10.08 |
2.8 |
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 PDD Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Feb 7 |
101.00 |
4.80 |
31 |
15.5 |
0.16 (0.2%) |
| Jan 10 |
101.00 |
0.94 |
3 |
31.3 |
0.16 (0.2%) |
| 5% Yield On PDD Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Feb 7 |
101.00 |
4.80 |
31 |
15.5 |
0.16 (0.2%) |
| Jan 10 |
101.00 |
0.94 |
3 |
31.3 |
0.16 (0.2%) |
| 10% Yield On PDD Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Feb 7 |
101.00 |
4.80 |
31 |
15.5 |
0.16 (0.2%) |
| Jan 10 |
101.00 |
0.94 |
3 |
31.3 |
0.16 (0.2%) |
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