How To YieldBoost Franklin Resources To 7.4% Using Options

Shareholders of Franklin Resources Inc (BEN) looking to boost their income beyond the stock's 6% annualized dividend yield can sell the January 2027 covered call at the $30 strike and collect the premium based on the 65 cents bid, which annualizes to an additional 1.5% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 7.4% annualized rate in the scenario where the stock is not called away. Any upside above $30 would be lost if the stock rises there and is called away, but BEN shares would have to climb 39.7% from current levels for that to happen, meaning that in the scenario where the stock is called, the shareholder has earned a 42.7% return from this trading level, in addition to any dividends collected before the stock was called.