Looking at the underlying holdings of the ETFs in our coverage universe at ETF Channel, we have compared the trading price of each holding against the average analyst 12-month forward target price, and computed the weighted average implied analyst target price for the ETF itself. For the iShares Mortgage Real Estate ETF (REM), we found that the implied analyst target price for the ETF based upon its underlying holdings is $24.75 per unit. Read More »

Shareholders of Chimera Investment Corp (CIM) looking to boost their income beyond the stock's 9.5% annualized dividend yield can sell the July covered call at the $7 strike and collect the premium based on the 25 cents bid, which annualizes to an additional 16.3% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 25.8% annualized rate in the scenario where the stock is not called away. Any upside above $7 would be lost if the stock rises there and is called away, but CIM shares would have to advance 49.9% from current levels for that to happen, meaning that in the scenario where the stock is called, the shareholder has earned a 55.2% return from this trading level, in addition to any dividends collected before the stock was called. Read More »