YieldBoost Royal Gold To 6.7% Using Options
In general, dividend amounts are not always predictable and tend to follow the ups and downs of profitability at each company. In the case of Royal Gold, Inc., looking at the dividend history chart for RGLD below can help in judging whether the most recent dividend is likely to continue, and in turn whether it is a reasonable expectation to expect a 1.4% annualized dividend yield.
Below is a chart showing RGLD's trailing twelve month trading history, with the $80 strike highlighted in red:
The chart above, and the stock's historical volatility, can be a helpful guide in combination with fundamental analysis to judge whether selling the January 2016 covered call at the $80 strike gives good reward for the risk of having given away the upside beyond $80. (Do most options expire worthless? This and six other common options myths debunked). We calculate the trailing twelve month volatility for Royal Gold, Inc. (considering the last 252 trading day closing values as well as today's price of $62.65) to be 49%. For other call options contract ideas at the various different available expirations, visit the RGLD Stock Options page of StockOptionsChannel.com.