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-TECH INC 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-TECH INC (QTEC)
Bid Ask Last Change Volume P/E Market Cap
72.30 73.23 72.66 -0.47 187K - 25B

QTEC Dividend-Like Income Using Covered Calls

With QTEC at 72.66, 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% 2.18 0.6
5% 3.63 1.0
10% 7.27 2.0

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
Nov 16 76.00 0.35 29 1.2 2.77 (3.8%)
Jan 18 78.00 0.55 92 0.6 4.77 (6.6%)
5% Yield On QTEC Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 76.00 0.35 29 1.2 2.77 (3.8%)
Jan 18 77.00 0.95 92 1.0 3.77 (5.2%)
10% Yield On QTEC Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 74.00 0.85 29 2.9 0.77 (1.1%)
Jan 18 75.00 1.90 92 2.1 1.77 (2.4%)

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