Dividends4Life: Get More From Dividend Stocks

Get More From Dividend Stocks

Posted by D4L | Tuesday, September 21, 2010 | | 0 comments »

Like more and more folks, I love dividend stocks these days, especially in my IRA. Good dividend stocks are a great way to ensure some returns during uncertain times. But the truth is, even high-yielding dividend stocks don't generally yield more than 7% or so. What if there was a way to boost your returns from your dividend stocks without taking tons of risk?

More and more investors are discovering options, but plenty of folks still feel like they should steer clear. But not all options strategies are risky or hard to understand. Writing covered calls, for instance, is a simple way to increase your returns on relatively stable stocks without exposing yourself to undue risks. What's that mean? Simple: A call option gives the owner the right to buy a stock at a specific price by a specific time. And you can sell options in addition to buying them -- that's called writing an option. If you sell a call option while you own the underlying stock, we say that that option is covered.

Source: The Money Times

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