PCG Dividend

Although PCG has a dividend of 0.03 with an ex-dividend date of Jun 30, you can sell covered calls on Pacific Gas & Electric Co. to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 3:20 PM ET):

Pacific Gas & Electric Co. (PCG)
Bid	Ask	Last	Change	Volume	P/E	Market Cap
13.88	13.89	13.89	-0.27	19.0M	13	38B

PCG Dividend-Like Income Using Covered Calls

With PCG at 13.89, 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%	0.42	0.1
5%	0.69	0.2
10%	1.39	0.4

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 PCG Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Aug 1	14.00	0.44	38	1.2	0.11 (0.8%)
Jul 3	14.00	0.20	9	2.2	0.11 (0.8%)

5% Yield On PCG Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Aug 1	14.00	0.44	38	1.2	0.11 (0.8%)
Jul 3	14.00	0.20	9	2.2	0.11 (0.8%)

10% Yield On PCG Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Aug 1	14.00	0.44	38	1.2	0.11 (0.8%)
Jul 3	14.00	0.20	9	2.2	0.11 (0.8%)

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