Shareholders of Amkor Technology Inc. (NASDAQ: AMKR) can enhance their income by selling a covered call for January 2028 at the $80 strike price, collecting a premium of $9.40. This premium translates to an additional 13.5% annualized return above the current 0.7% dividend yield, totaling a potential 14.2% annualized return if the stock is not called away. However, shareholders risk losing any price gains above the $80 threshold, which requires a 57.1% appreciation from the current share price of $50.55 for the stock to be called, resulting in an overall return of 75.6% if that occurs.
As of Wednesday mid-afternoon trading, options activity among S&P 500 components shows 2.99 million put contracts and 5.92 million call contracts, yielding a put/call ratio of 0.51, indicating a higher preference for call options amongst traders compared to the long-term median ratio of 0.65.
The trailing twelve-month volatility for Amkor Technology is calculated at 79%, providing a context for evaluating the reward versus risk in these options strategies.
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