Strategy To YieldBoost BF.B From 1.7% To 6.4% Using Options
March 20, 2024 at 12:04 PM EDT
Shareholders of Brown-Forman Corp (BF. ) looking to boost their income beyond the stock's 1.7% annualized dividend yield can sell the September covered call at the $60 strike and collect the premium based on the $1.25 bid, which annualizes to an additional 4.7% 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.