Power Integrations Inc. (NASDAQ: POWI) shareholders looking to increase their income can sell October covered calls at the $100 strike, with a premium bid of $14.20. This strategy could yield a 45.5% annualized return based on the current stock price of $84.17, leading to a total potential annualized return of 46.5% if the stock is not called. If the stock rises above $100, shareholders would lose any upside beyond that price, but would realize a 35.2% return if called, in addition to any dividends.
The trailing twelve-month volatility for Power Integrations has been calculated at 55%, based on 251 trading days. In mid-afternoon trading on a Wednesday, S&P 500 components saw put volume at 3.04 million contracts against call volume of 7.03 million, resulting in a put-to-call ratio of 0.43, indicating a preference for calls among buyers.
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