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5 Dividend-Captures With Option Trades

Corrections Corp Of America (CXW - Get Report)

Corrections Corporation of America, together with its subsidiaries, owns and operates privatized correctional and detention facilities.

Yield: 2.88%
Dividend Amount: $0.20
Ex-Dividend Date: June 06, 2012
Beta: 0.91

Strategy: Buy Corrections Corp Of America stock and offer to sell the June $25.00 strike or lower call for 32 cents over the intrinsic value.

If my shares are called away the day before trading ex-dividend (resulting from the option buyer wanting the dividend), I gain about 32 cents. The most I can make is 52 cents if I hold the covered call through option expiration day and the stock gets called away.

After qualifying for the dividend, I will attempt to close out the trade with a gain of near 14 cents, plus the dividend earned.

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ADP $83.53 0.00%
CXW $39.11 0.00%
KSS $74.47 0.00%
OXY $80.53 0.00%
TRV $105.40 0.00%


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