New Options for Check Point Software Present Potential Opportunities

Investors in Check Point Software Technologies, Ltd. (Symbol: CHKP) will find new options available this week, expiring on October 17th. One critical aspect influencing the price an option buyer is willing to pay is the time value. With 233 days until expiration, these newly available contracts provide a potential opportunity for put or call sellers to earn a higher premium compared to contracts with shorter durations. Using our YieldBoost formula, Stock Options Channel identified one put and one call contract of particular interest among the new October 17th offerings.

Analyzing the New Put Option

The put contract at the $220.00 strike price currently has a bid of $14.10. If an investor sells that put contract, they commit to buying shares of Stock at $220.00 while collecting the premium. This action effectively lowers the cost basis of the shares to $205.90, before broker commissions. For investors already interested in acquiring CHKP shares, this presents a more appealing option compared to the current market price of $222.10 per share.

The $220.00 strike is about 1% below the current trading price, indicating that it is out-of-the-money by that percentage. Current analytical data suggests that there is a 60% chance the put contract could expire worthless. Stock Options Channel will continuously monitor these odds and publish a chart of their evolution on our website under the contract detail page. Should the contract expire worthless, the premium would yield a 6.41% return on the cash commitment or 10.04% annualized—a process we term as YieldBoost.

Check Point Trading History

Below is a chart displaying the trailing twelve-month trading history of Check Point Software Technologies, Ltd., with the $220.00 strike indicated in green:

Details on the Call Option

Turning to the call side, the call contract at the $230.00 strike price currently holds a bid of $17.00. If an investor purchases shares of CHKP at the current price of $222.10 and sells the call contract as a “covered call,” they would commit to selling the shares at $230.00. Including the premium collected, this strategy would deliver a total return of 11.21% if the stock is called away at the October 17th expiration (excluding dividends and before broker commissions).

However, significant upside may be forfeited if CHKP shares appreciate greatly, underscoring the importance of reviewing both the trailing trading history of Check Point Software Technologies, Ltd. and the company’s fundamentals. Below is a chart demonstrating CHKP’s trading history, with the $230.00 strike highlighted in red:

Since the $230.00 strike is roughly 4% above the current trading price, it is also out-of-the-money by that percentage. Current analytical data indicates a 47% chance that the covered call contract may expire worthless, allowing the investor to retain both their shares and the premium collected. If the covered call expires worthless, the premium would represent an additional 7.65% return for investors, or 11.99% annualized—a figure also referred to as YieldBoost.

Volatility Considerations

The implied volatility for both the put and call contracts stands at approximately 28%. In comparison, our calculations indicate that the actual trailing twelve-month volatility, based on the last 250 trading days and the current price of $222.10, is 26%. For additional insights on put and call options worth exploring, visit StockOptionsChannel.com.

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Also see:

• CEF Channel
• ETFs Holding AKR
• ANTH shares outstanding history

The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.