How To YieldBoost Ryland Group To 6.4% Using Options

Shareholders of Ryland Group, Inc. (NYSE: RYL) looking to boost their income beyond the stock's 0.3% annualized dividend yield can sell the January 2016 covered call at the $45 strike and collect the premium based on the $3.10 bid, which annualizes to an additional 6.1% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 6.4% annualized rate in the scenario where the stock is not called away. Any upside above $45 would be lost if ...