The 'Yield As Loud As You EnCana' Trade
By Joe Springer:I think EnCana (NYSE:ECA), The Little Energy Stock that Could, is a good pick for income investors as it currently yields 3.6%-- but it could be even better. We'd like to suggest that as nice as EnCana's dividend yield is, a nimble income investor can get about two or three times that yield on a regular basis by writing (selling) call options on the EnCana stock that they own.A guy from the South merged onto a highway and got into an accident with a guy from the North. When the Northerner asked the Southerner why he didn't yield, the Southerner said "I yield as loud as I could!"And so it is with EnCana, we like its yield but we want it to yield as loud as it can, or if you will, as loud as it EnCana.
Writing Covered Calls
First let's understand what a call option is.Complete Story »