Tuesday, October 7, 2014

Boost Caterpillar CAT income

English: Wheel loader (front end loader) made ...
English: Wheel loader (front end loader) made by the Caterpillar company. (Photo credit: Wikipedia)
Caterpillar is not a Dividend Machine because the yield is too low.   However, for such an old company, the stock price is quite volatile and that leads to option income opportunities.

Caterpillar, symbol CAT, has raised the dividend an average of 13 percent per year for at least the past 5 years.   When you sell a call that goes out far enough that you get both the dividend and the call premium, you boost your income from CAT to about four percent.