2022-01 Dividend Income Report

Here is the dividend income report for January, 2022.

The monthly dividend income came out to $73.28. The yearly income total for 2022 through the end of the month was $73.28.

The income for January 2021 was $88.40, and the yearly income for 2021 through the end of January was $88.40.

So far there is not much to tell. I am getting back into listening to some conference calls and taking notes in Org Mode. I plan on buying a REIT that pays monthly in the next few weeks.

When I first went to ETFs, there was not much income in January since bond funds do two payouts in December. That is starting to change for me with LAND and XYLD.

I tend to let podcasts pile up, and sometimes have years of archives to go through when I change podcasts. Now I am listening to The Index Investing Show with Ron DeLegge. I am now in April of 2020. It looks like he ended the podcast. I have not listened to the last episode in full, so I do not know if he will continue it elsewhere. He has another site: ETF Guide, and a YouTube channel. I did briefly listen to the beginning of the last episode, and he hinted that the Index Investing Show might continue on YouTube, but so far I only see the ETF Guide channel, and that channel does not have a video about the Index Investing Show.

In one of the episodes I listened to, he mentioned that everyone should have a written investment policy statement. I said a few years ago I would write one, and so far I have not. I added it in my ever-growing to-do list in my Org file.

One of his videos on the ETF Guide channel was an ETF battle: It was JEPI (JPMorgan Equity Premium Income ETF) vs SCHD (Schwab US Dividend Equity ETF) vs XYLD (Global X S&P 500 Covered Call ETF). SCHD won the battle due to cost and performance. I don’t think SCHD fits with the other two. It is just a standard stock ETF focusing on dividend stocks. The other two invest in large-caps stocks and sell options. JEPI has lower cost, but it is JP Morgan, and frankly I do not want to give those bungholes any more of my money. I think the reason JEPI has lower costs is because it has more assets and JP Morgan is a bigger company. Also it is actively managed, and I prefer index funds. XYLD uses the CBOE S&P 500 BuyWrite Index, which I grant is pretty obscure (methodology here).

On the Index Investing Show, Ron DeLegge often talks about the ETF Guide Premium newsletter. They have monthly income trades. They sell covered calls on 2 ETFs: SPDR S&P 500 (SPY) and SPDR Gold Shares (GLD). Sometimes they have a third. I got a free sample of the newsletter, and I think that XYLD can yield the same amount with less effort.

When I was living in Chicago, I knew a lot of people who worked in trading. One guy was thinking about applying for a job at one of the exchanges, and he got some pamphlets explaining derivatives. One of them said something to the effect of, “If this all sounds like legalized gambling, that is because it is.”

As I understand the covered call strategy, you are placing a bet that the stock will stay below a certain price (known as the “strike price”). You are selling an option, or “writing a call”. The other party pays you a premium to buy the option. If the stock prices is above the strike price at the expiration date, the buyer of the option can compel the seller of the option to give the buyer their stock. (Someone told me the difference between options and futures is that futures must be exercised, while options do not, which is why options are called “options”.) If the stock is below the strike price at the expiration date, nothing changed hands and the buyer keeps the premium. Many parties buy options as a form of insurance, and most expire worthless, allowing the seller of the option to keep the premium. Per the index methodology doc, the index writes 2% out-of-the-money call options expiring in the next month.

So far XYLD is working out well for me. Like all the other ETFs, the dividend amount is inconsistent.

Here is a table with the year-to-date amounts, the monthly amounts, and the three- and twelve-month moving averages for each January from 2012 through 2022:

Month YTD Amount 3MMA 12MMA
2022-01 $73.28 $73.28 $1215.96 $911.36
2021-01 $88.40 $88.40 $1258.54 $884.83
2020-01 $12.01 $12.01 $1236.27 $866.30
2019-01 $90.72 $90.72 $818.52 $583.57
2018-01 $59.59 $59.59 $819.32 $614.81
2017-01 $218.88 $218.88 $584.54 $504.86
2016-01 $237.08 $237.08 $550.81 $457.97
2015-01 $213.49 $213.49 $471.54 $374.28
2014-01 $159.67 $159.67 $335.67 $287.98
2013-01 $110.12 $110.12 $348.07 $292.20
2012-01 $188.68 $188.68 $316.66 $256.77

 

Here are the securities and the income amounts for January, 2022:

  • Global X S&P 500 Covered Call ETF: $50.25
  • Gladstone Land: $23.03

Big Jim’s year is starting out pretty well.

Painting of Last Judgement in the Arena Chapel in Padua by Giotto di Bondone (1267 – 1337); assumed allowed under public domain.

One Reply to “2022-01 Dividend Income Report”

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Page created on 2022-02-06_14:06:32, last modified on 2022-03-20_8:30:31.

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