RTX Corp (Symbol: RTX) shareholders can enhance their income by selling covered calls on the stock at a $260 strike price with a January 2028 expiration. The current bid for this option is $12.50, translating to an additional 3.2% annualized return on top of the stock’s 1.4% dividend yield, yielding a combined annualized return of 4.6% if the stock is not called away. However, any upside beyond $260 would be forfeited if the stock appreciates sufficiently to be called away, requiring a 33.4% increase from its present trading level of $196.20.
Additionally, RTX’s trailing twelve-month stock volatility is recorded at 28%, providing insight for investors weighing the risks of selling the covered call against potential rewards. On Wednesday, amid broader S&P 500 trading, there were 886,181 put contracts and 1.63 million call contracts, resulting in a put:call ratio of 0.54, reflecting a strong preference for call options in current market conditions.
