Dividend Capture Strategy for easy cash flow

Dividend Capture strategy for easy cash flow on XOM

Exxon Mobil pays .82 per share quarterly and the ex-dividend date is this Friday (2/8/2019) the dividend pay date is on 3/11/19. So yearly Will get $3.28 (.82x4)for a dividend yield of 4.4% not bad.

But by selling the ATM Put for $1.02 I will increase the premium plus dividend paid for the year to $4.30 and increase the yield to 5.77%. That alone is an improvement of 31%.

If I don't get assigned I get to keep the premium and make over $500 in a couple of days and if I do get assigned then I will sell some calls to keep reducing my basis and improve my yield even more.

The Trade: XOM
Sold 5 ATM Puts @ 74.5 for $1.02
4 days to expiration

İşlem aktif:

I actually made a mistake doing this trade. I need to own the stock before the Ex dividend date for me to get the dividend so I would have to make a decision before that date if I want the dividend.

Here is the video where I explain the trade:
youtu.be/Lgqr20FvSjs


Other trades I made using the same strategy:

JNJ $.90 Div. quarterly (Yield 2.71%) Ex Div. Date 2/25/19
Sold the 132 put that expires on Feb 22 for $1.50

ED $.74 Div quarterly (Yield 3.82%) Ex Div. Date 2/12/19
Sold the 77 Put that expires on Feb 8 for .43

TGT $.64 Div. quarterly (Yield 3.53%) Ex Div. Date 2/19/19
Sold the 72 Put that expires on Feb 15 for $1.00

İşlem elle kapatılmış:

Forgot to update this trade.

I bought 500 stock the day before EX div. date to be sure I get the dividend and sold calls against it. When I got some profit I closed everything for a total win of $720.

Yorum:

The other 3 trades the put expired worthless and I kept the premiums.