How To YieldBoost FITB To 8.6% Using Options

Shareholders of Fifth Third Bancorp (FITB) looking to boost their income beyond the stock's 3.7% annualized dividend yield can sell the June 2025 covered call at the $45 strike and collect the premium based on the $2.00 bid, which annualizes to an additional 4.9% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 8.6% annualized rate in the scenario where the stock is not called away. Any upside above $45 would be lost if the stock rises there and is called away, but FITB shares would have to climb 19% from current levels for that to happen, meaning that in the scenario where the stock is called, the shareholder has earned a 24.3% return from this trading level, in addition to any dividends collected before the stock was called.