SDD Dividend Type Payments

ProShares UltraShort SmallCap600 dividend

Although SDD has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on ProShares UltraShort SmallCap600 to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 2:40 PM ET):

ProShares UltraShort SmallCap600 (SDD)
Bid Ask Last Change Volume P/E Market Cap
15.86 15.93 15.90 -0.05 1K - 0.0B

SDD Dividend-Like Income Using Covered Calls

With SDD at 15.90, 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% 0.48 0.1
5% 0.80 0.2
10% 1.59 0.4

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 SDD Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 15 16.00 0.75 215 0.3 0.07 (0.4%)
May 16 16.00 0.50 124 0.4 0.07 (0.4%)
5% Yield On SDD Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 15 16.00 0.75 215 0.3 0.07 (0.4%)
May 16 16.00 0.50 124 0.4 0.07 (0.4%)

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Want more examples? SDCI Dividend | SDEM Dividend