Strategy To YieldBoost AMAT From 1% To 4.2% Using Options
March 20, 2017 at 11:41 AM EDT
Shareholders of Applied Materials, Inc. (AMAT) looking to boost their income beyond the stock's 1% annualized dividend yield can sell the January 2019 covered call at the $50 strike and collect the premium based on the $2.31 bid, which annualizes to an additional 3.2% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 4.2% annualized rate in the scenario where the stock is not called away..