PNQI Dividend Type Payments

Although PNQI has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Powershares NASDAQ Internet to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 11:45 AM ET):

Powershares NASDAQ Internet (PNQI)
Bid Ask Last Change Volume P/E Market Cap
134.87 134.94 134.89 +1.06 8K - 0.6B

PNQI Dividend-Like Income Using Covered Calls

With PNQI at 134.89, here's a table showing how big the annual "dividend" (ie. 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% 4.05 1.1
5% 6.74 1.8
10% 13.49 3.7

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 PNQI Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Apr 18 138.00 0.40 24 1.7 3.06 (2.3%)
May 17 141.00 0.60 53 1.1 6.06 (4.5%)
5% Yield On PNQI Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Apr 18 137.00 0.85 24 3.5 2.06 (1.5%)
May 17 139.00 1.25 53 2.4 4.06 (3.0%)
10% Yield On PNQI Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Apr 18 136.00 1.40 24 5.8 1.06 (0.8%)
May 17 137.00 2.15 53 4.1 2.06 (1.5%)

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Want more examples? PNNT Dividend | PNR Dividend