How To YieldBoost Tredegar To 14% Using Options
April 14, 2014 at 12:14 PM EDT
Shareholders of Tredegar Corp. (TG) looking to boost their income beyond the stock's 1.2% annualized dividend yield can sell the September covered call at the $25 strike and collect the premium based on the $1.30 bid, which annualizes to an additional 12.8% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 14% annualized rate in the scenario where the stock is not called away..