How To YieldBoost Intel Corp From 3% To 4.4% Using Options

Shareholders of Intel Corp (INTC) looking to boost their income beyond the stock's 3% annualized dividend yield can sell the January 2019 covered call at the $45 strike and collect the premium based on the 95 cents bid, which annualizes to an additional 1.5% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 4.4% annualized rate in the scenario where the stock is not called away. Any upside above $45 would be lost if the stock rises there and is called away, but INTC shares would have to advance 27.8% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 30.5% return from this trading level, in addition to any dividends collected before the stock was called.