IQ Dividend Type Payments
Although IQ has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iQIYI, Inc. - American Depositary Shares to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 4:16 PM ET):
| iQIYI, Inc. - American Depositary Shares (IQ) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 2.18 |
2.19 |
2.18 |
-0.02 |
5.6M |
2200 |
0.0B |
IQ Dividend-Like Income Using Covered Calls
With IQ at 2.18, here's a table showing how big the annual "dividend" (i.e. total annual call premium received) would need to be to attain 3%, 5%, and 10% annual yields. Also shown is the equivalent number of cents/day necessary to achieve each yield:
| Annual Yield |
Annual Premium |
Cents/Day |
| 3% |
0.07 |
0.0 |
| 5% |
0.11 |
0.0 |
| 10% |
0.22 |
0.1 |
So now we need to find out of the money covered calls that pay at least the prescribed cents/day amount of time premium. That will generate income and, because they are out of the money, leave room for some upside potential on the stock. Here are some examples:
| 3% Yield On IQ Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Nov 7 |
2.50 |
0.04 |
15 |
0.3 |
0.31 (14.2%) |
| Nov 14 |
2.50 |
0.01 |
22 |
0.0 |
0.31 (14.2%) |
| 5% Yield On IQ Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Nov 7 |
2.50 |
0.04 |
15 |
0.3 |
0.31 (14.2%) |
| Nov 14 |
2.50 |
0.01 |
22 |
0.0 |
0.31 (14.2%) |
| 10% Yield On IQ Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Nov 7 |
2.50 |
0.04 |
15 |
0.3 |
0.31 (14.2%) |
| Dec 19 |
3.00 |
0.05 |
57 |
0.1 |
0.81 (37.2%) |
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