YieldBoost TGLS From 0.8% To 14.5% Using Options

Shareholders of Tecnoglass Inc (TGLS) looking to boost their income beyond the stock's 0.8% annualized dividend yield can sell the October covered call at the $90 strike and collect the premium based on the $8.60 bid, which annualizes to an additional 13.7% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 14.5% annualized rate in the scenario where the stock is not called away. Any upside above $90 would be lost if the stock rises there and is called away, but TGLS shares would have to climb 13.4% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 24.3% return from this trading level, in addition to any dividends collected before the stock was called.