Friday, January 02, 2009

Dividend Power

Here's a little update of my previous LEAP studies, but I've added the contribution of annual dividend payouts for the LEAPS. Dividends are obviously distributed throughout the year, but I was only interested in seeing how the payout affected the total LEAP ROI. In most cases, it increases return by about 5%. . . not an insignificant number. The Qs are the exception of this study, as they pay virtually nothing.
The VIX is crossing below the 40s level today, and if this tendency continues the expectation is for premium to decline and thus for total returns to diminish.

No comments: