Strategy To YieldBoost CMRE To 14.9% Using Options

Shareholders of Costamare Inc (CMRE) looking to boost their income beyond the stock's 3.2% annualized dividend yield can sell the March 2025 covered call at the $16 strike and collect the premium based on the 75 cents bid, which annualizes to an additional 11.7% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 14.9% annualized rate in the scenario where the stock is not called away. Any upside above $16 would be lost if the stock rises there and is called away, but CMRE shares would have to advance 11.5% from current levels for that to happen, meaning that in the scenario where the stock is called, the shareholder has earned a 16.7% return from this trading level, in addition to any dividends collected before the stock was called.