YieldBoost Microchip Technology To 16.6% Using Options
October 21, 2014 at 11:36 AM EDT
Shareholders of Microchip Technology, Inc. (MCHP) looking to boost their income beyond the stock's 3.6% annualized dividend yield can sell the April 2015 covered call at the $40 strike and collect the premium based on the $2.55 bid, which annualizes to an additional 13.1% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 16.6% annualized rate in the scenario where the stock is not called away..