YieldBoost BANC To 14.8% Using Options

Shareholders of Banc Of California Inc (BANC) looking to boost their income beyond the stock's 2.5% annualized dividend yield can sell the April 2025 covered call at the $17.50 strike and collect the premium based on the 80 cents bid, which annualizes to an additional 12.3% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 14.8% annualized rate in the scenario where the stock is not called away. Any upside above $17.50 would be lost if the stock rises there and is called away, but BANC shares would have to advance 8.9% from current levels for that to happen, meaning that in the scenario where the stock is called, the shareholder has earned a 13.9% return from this trading level, in addition to any dividends collected before the stock was called.