In an increasingly expensive market, finding low volatility investments at a discount can be difficult.
We consider the recent sell-off in AMC and AGL represents a low risk entry level for a buy-write strategy.
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AMC pays a 25.6 cent dividend on the 24th February and AGL pays 41 cents on the 23rd February.
We are then adding covered call options to enhance the yield and allowing for moderate capital growth.
The strategy is achieving 10 – 12% cash flow on an annualised basis.
