Shareholders of Organon & Co (OGN) looking to boost their income beyond the stock's 6.1% annualized dividend yield can sell the October covered call at the $20 strike and collect the premium based on the $1.65 bid, which annualizes to an additional 15% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 21.1% annualized rate in the scenario where the stock is not called away. Any upside above $20 would be lost if the stock rises there and is called away, but OGN shares would have to advance 9.2% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 18.2% return from this trading level, in addition to any dividends collected before the stock was called.

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