Strategy To YieldBoost ECL To 7% Using Options
November 23, 2015 at 11:31 AM EST
Shareholders of Ecolab, Inc. (ECL) looking to boost their income beyond the stock's 1.1% annualized dividend yield can sell the July 2016 covered call at the $125 strike and collect the premium based on the $4.60 bid, which annualizes to an additional 5.9% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 7% annualized rate in the scenario where the stock is not called away..