I guess it could be used for an anchor recovery system but it is really the main part of a anchor kelge system. Connect a weight perhaps a mushroom anchor and light weight line to one of the eyes. Slip the device over you anchor rode and feed out about 12 - 15 of the light line. This will keep your anchor rode below your keel thereby now allowing it wrap around as the boat swings. If you have a wing keel it is almost something that you must have or sooner or latter you will find out why. Now if you are using all chain put it in the next marine flee market. The ring used to be sold by West Marine for about $30.00 or so.
txtowman got it right It's part of an anchor recovery system. You place the ring around the rode, attach a poly-ball. Then drive your boat away from the anchor. The ring will ride down the chain and will actually float your anchor.
They work great and I have used one for years. Check it out here http://www.savvyboater.com/p-42-anchor-ring-anchor-retriever.aspx
We would have 600'-800' of rode out when anchored offshore fishing. Makes for a fairly easy retrival at the end of a long day, they work pretty slick. I'm not sure how feasable they would be for a sailboat in a crowded anchorage.
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