QTEC Dividend Type Payments
Although QTEC has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on First Trust NASDAQ-100-Technology Sector Index Fund 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):
| First Trust NASDAQ-100-Technology Sector Index Fund (QTEC) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 210.86 |
214.77 |
212.86 |
-3.13 |
98K |
- |
0.2B |
QTEC Dividend-Like Income Using Covered Calls
With QTEC at 212.86, 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% |
6.39 |
1.7 |
| 5% |
10.64 |
2.9 |
| 10% |
21.29 |
5.8 |
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 QTEC Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Oct 17 |
215.00 |
5.10 |
50 |
10.2 |
0.23 (0.1%) |
| Sep 19 |
215.00 |
2.55 |
22 |
11.6 |
0.23 (0.1%) |
| 5% Yield On QTEC Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Oct 17 |
215.00 |
5.10 |
50 |
10.2 |
0.23 (0.1%) |
| Sep 19 |
215.00 |
2.55 |
22 |
11.6 |
0.23 (0.1%) |
| 10% Yield On QTEC Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Oct 17 |
215.00 |
5.10 |
50 |
10.2 |
0.23 (0.1%) |
| Sep 19 |
215.00 |
2.55 |
22 |
11.6 |
0.23 (0.1%) |
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