JEF Dividend Type Payments

Although JEF has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Jefferies Financial Group Inc. to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 12:20 PM ET):

Jefferies Financial Group Inc. (JEF)
Bid	Ask	Last	Change	Volume	P/E	Market Cap
74.11	74.15	74.13	+0.28	283K	32	15B

JEF Dividend-Like Income Using Covered Calls

With JEF at 74.13, here's a table showing how big the annual "dividend" (i.e. total annual call premium received) would need to be to attain 3%, 5%, and 10% annual yields. Also shown is the equivalent number of cents/day necessary to achieve each yield:

Annual Yield	Annual Premium	Cents/Day
3%	2.22	0.6
5%	3.71	1.0
10%	7.41	2.0

So now we need to find out of the money covered calls that pay at least the prescribed cents/day amount of time premium. That will generate income and, because they are out of the money, leave room for some upside potential on the stock. Here are some examples:

3% Yield On JEF Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Dec 20	75.00	2.15	33	6.5	0.85 (1.1%)
Jan 17	75.00	3.30	61	5.4	0.85 (1.1%)

5% Yield On JEF Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Dec 20	75.00	2.15	33	6.5	0.85 (1.1%)
Jan 17	75.00	3.30	61	5.4	0.85 (1.1%)

10% Yield On JEF Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Dec 20	75.00	2.15	33	6.5	0.85 (1.1%)
Jan 17	75.00	3.30	61	5.4	0.85 (1.1%)

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