Strategy To YieldBoost MMC To 4.7% Using Options
June 25, 2014 at 11:56 AM EDT
Shareholders of Marsh & McLennan Companies Inc. (MMC) looking to boost their income beyond the stock's 2.2% annualized dividend yield can sell the January 2015 covered call at the $55 strike and collect the premium based on the 75 cents bid, which annualizes to an additional 2.6% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 4.7% annualized rate in the scenario where the stock is not called away..