Tuesday, July 23, 2019

Nvidia chips for income

The chip sector is incredibly lucrative for selling covered calls.  You don't get paid much to wait with this chip stock, Nvidia symbol NVDA, less than a 1% dividend yield, but the calls allow you to roll them frequently.  Sell calls with short expirations is how I roll the calls on growth or low dividend yielding stocks.  I am an income investor.

NVDA $187.50 August 30 Covered Call

In this call, I bought NVDA today at $175.66 and immediately sold a $187.50 call that expires on 8/30/2019.

If I am assigned on the expiration date, I should still get the dividend.  But the dividend is barely important.

The call premium alone yields 2.33% nearly as much as INTC 2.45% and if I am assigned, I realize a 9.17% total return on these shares in 6 weeks.

M* MoneyMadam

Disclosure:  Long NVDA