How To YieldBoost Cricut From 2.5% To 88.5% Using Options

Shareholders of Cricut Inc (CRCT) looking to boost their income beyond the stock's 2.5% annualized dividend yield can sell the May covered call at the $10 strike and collect the premium based on the 15 cents bid, which annualizes to an additional 86% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 88.5% annualized rate in the scenario where the stock is not called away. Any upside above $10 would be lost if the stock rises there and is called away, but CRCT shares would have to advance 25.6% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 27.5% return from this trading level, in addition to any dividends collected before the stock was called.