RLI Dividend Type Payments
Although RLI has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on RLI Corp. (DE) 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):
| RLI Corp. (DE) (RLI) | ||||||
|---|---|---|---|---|---|---|
| Bid | Ask | Last | Change | Volume | P/E | Market Cap |
| 74.38 | 77.22 | 75.88 | +0.24 | 404K | 40 | 6.9B |
RLI Dividend-Like Income Using Covered Calls
With RLI at 75.88, 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% | 2.28 | 0.6 |
| 5% | 3.79 | 1.0 |
| 10% | 7.59 | 2.1 |
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 RLI Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Sep 19 | 80.00 | 1.55 | 197 | 0.8 | 2.78 (3.7%) | |
| Jun 20 | 78.00 | 1.05 | 106 | 1.0 | 0.78 (1.0%) | |
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| Top 10 Open Interest For Mar 21 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | NVDA dividend | 6. | KWEB dividend | 1. | APP dividend | |
| 2. | SPY dividend | 7. | QQQ dividend | 2. | QBTS dividend | |
| 3. | IWM dividend | 8. | INTC dividend | 3. | CLSK dividend | |
| 4. | FXI dividend | 9. | TSLA dividend | 4. | KSS dividend | |
| 5. | EEM dividend | 10. | SLV dividend | 5. | ARVN dividend | |
Want more examples? RLGT Dividend | RLJ Dividend
