Strategy To YieldBoost Big Lots From 1.6% To 11.1% Using Options
April 08, 2015 at 11:30 AM EDT
Shareholders of Big Lots, Inc. (BIG) looking to boost their income beyond the stock's 1.6% annualized dividend yield can sell the October covered call at the $52.50 strike and collect the premium based on the $2.40 bid, which annualizes to an additional 9.5% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 11.1% annualized rate in the scenario where the stock is not called away..
