Shareholders of D.R. Horton Inc. (NYSE: DHI) looking to boost their income beyond the stock's 0.6% annualized dividend yield can sell the January 2015 covered call at the $35 strike and collect the premium based on the $2.23 bid, which annualizes to an additional 5% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 5.6% annualized rate in the scenario where the stock is not called away. Any upside above $35 would be lost if the ...
Shareholders of D.R. Horton Inc. (NYSE: DHI) looking to boost their income beyond the stock's 0.6% annualized dividend yield can sell the January 2015 covered call at the $35 strike and collect the premium based on the $2.23 bid, which annualizes to an additional 5% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 5.6% annualized rate in the scenario where the stock is not called away. Any upside above $35 would be lost if the ...
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