Clearway Energy Inc Options Offering Highlights Potential Investment Opportunities

Investors in Clearway Energy Inc (Symbol: CWEN) have new options available for the November 21st expiration. With 231 days until expiration, these contracts present an opportunity for sellers of puts and calls to earn higher premiums compared to those with approaching expiration dates. Thanks to our YieldBoost formula at Stock Options Channel, we have identified one put and one call contract that stand out.

Put Contract Details

The put contract at the $25.00 strike price currently has a bid of 90 cents. If an investor sells this contract, they are agreeing to buy the stock at $25.00 while also collecting the premium. This arrangement reduces the effective cost basis of the shares to $24.10, not including broker commissions. For those already interested in acquiring CWEN shares, this presents a potentially attractive alternative to purchasing at the current price of $29.13 per share.

This strike price represents approximately a 14% discount to the current trading price, making it out-of-the-money by that percentage. According to current analytical data, the probability of this put contract expiring worthless stands at 75%. We will monitor these odds and publish updates on our website, including a chart tracking these figures over time. If the contract expires worthless, the premium would yield a 3.60% return on the invested cash, annualized to 5.69%, which we call a YieldBoost.

Trading History Chart

Below is a chart illustrating Clearway Energy Inc’s trailing twelve-month trading patterns, with the $25.00 strike price marked in green:

Call Contract Insights

On the call side, the contract at the $30.00 strike price currently bids at $2.40. Investors purchasing CWEN shares at the current price of $29.13 and then selling this call as a “covered call” commit to sell the stock at $30.00. The total return—excluding dividends—would reach 11.23% if the stock gets called away by the November 21st expiration (excluding broker commissions). However, potential upside gains may be capped if CWEN shares appreciate significantly, making historical performance analysis and business fundamentals important considerations for investors.

Below is a chart depicting CWEN’s trailing twelve-month trading history, with the $30.00 strike highlighted in red:

Since the $30.00 strike is about a 3% premium to the current trading price, there is also a chance this covered call could expire worthless. Should that occur, the investor retains both the shares and the premium collected. Current analytical data suggest the odds of the contract expiring worthless as 50%. We will again track and update these metrics on our website, along with visual representations of the contract’s trading history. If the covered call expires worthless, the premium would contribute to an 8.24% additional return, annualized to 13.02%, which we also term YieldBoost.

Volatility Insights

The implied volatility for both the put and call contracts is approximately 34%. In contrast, we calculate the actual trailing twelve-month volatility, based on the last 251 trading days and today’s price of $29.13, to be at 30%. If you’re interested in additional put and call options contract ideas, visit StockOptionsChannel.com.

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