Like I tried to imply in my comments above the article, I don't think there are any examples.
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buy dividend stocks on high margin at cheap borrow
- Thread starter stock777
- Start date
Like I tried to imply in my comments above the article, I don't think there are any examples.
Quote from Eliot Hosewater:
Like I tried to imply in my comments above the article, I don't think there are any examples.
Thanks, before the big event last week I was able to find collars for NLY (15% yield) for about 35-40%. Certanly not free but would work I guess, especially with some margin involved to get more % out.
(35-40% of the div payout that is)
Bying 1-2-year bank bonds could be equally rewarding. Unlike stocks there is no chance of substantial appreciation... but then you get all the money back at the maturity (provided the bank doesn't collapse).
For people in no immediate need for cash, bonds pay substantially more than a typical saving account... not to mention the possibility of using leverage.
For people in no immediate need for cash, bonds pay substantially more than a typical saving account... not to mention the possibility of using leverage.
Quote from Gustaf:
Thanks, before the big event last week I was able to find collars for NLY (15% yield) for about 35-40%. Certanly not free but would work I guess, especially with some margin involved to get more % out.
(35-40% of the div payout that is)
After reading that article I went into ToS back testing. I found that AGNC (another mREIT paying 20%) would increase in stock price in the two or three weeks before ex-date enough so that married puts would have been a big winner. I would use married puts instead of calls so that if the stock didn't move you would still get the divvy. You could have sold the stock the day before ex-date and kept the put in place for more than the dividend. That scenario didn't play out the last time around in June. The stock price didn't move at all and fell ex-div by the divvy amount.