Strategy To YieldBoost CRS To 18.9% Using Options
December 08, 2016 at 11:39 AM EST
Shareholders of Carpenter Technology Corp. (CRS) looking to boost their income beyond the stock's 1.9% annualized dividend yield can sell the March 2017 covered call at the $40 strike and collect the premium based on the $1.75 bid, which annualizes to an additional 17.1% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 18.9% annualized rate in the scenario where the stock is not called away..