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Shareholders of NOV Inc (Symbol: NOV) can consider selling a January 2028 covered call at a $20 strike price to enhance their income beyond the stock’s current 2% annualized dividend yield. This strategy could yield an additional 5.9% rate of return, bringing the total potential return to 7.9% if the stock is not called away. The current stock price is $15.01, implying a need for a 33.7% increase before the stock is called.
The annualized return, should the stock be called, would amount to 46.4% when combined with any dividends collected. NOV Inc’s trailing twelve-month volatility is calculated at 45%, and on the trading day reported, call volume stood at 1.84 million contracts, compared to put volume of 886,867 contracts, resulting in a put:call ratio of 0.48, indicating a strong preference for calls among traders.
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