New Meta Options Trading Offers Investors Strategic Opportunities

Investors in Meta Platforms Inc (Symbol: META) observed new options begin trading today, set to expire on June 13th. Utilizing our YieldBoost formula, Stock Options Channel has identified one put and one call contract of particular interest from the META options chain.

Put Contract Analysis

The put contract placed at the $575.00 strike price currently has a bid of $24.85. If an investor were to sell-to-open this put, they would commit to buying the stock at $575.00. By doing so, they collect the premium, lowering their effective cost basis to $550.15 per share (before broker commissions). For those already looking to acquire META shares, this offers an appealing alternative to the current market price of $578.52 per share.

This $575.00 strike price reflects roughly a 1% discount from the current trading price, meaning it is out-of-the-money by this percentage. Current analytical data, including greeks and implied greeks, suggest there is a 54% chance that the put contract might expire worthless. Stock Options Channel will monitor these odds over time and provide updates on the contract detail page on our website. Should the contract expire worthless, the premium equates to a 4.32% return on the cash commitment, or an annualized 36.68%, termed as the YieldBoost.

Call Contract Analysis

On the call side, the contract at the $585.00 strike price has a current bid of $23.00. If an investor purchases META shares at the current price of $578.52 and sells the call contract as a “covered call,” they would agree to sell shares at $585.00. Including the premium collected, this would yield a total return of 5.10% if the stock is called away by the June 13th expiration (excluding dividends and before broker commissions). There is a potential risk of missing out on significant upside if META shares rise sharply, making it essential to analyze historical trading data and business fundamentals.

The $585.00 strike represents about a 1% premium over the current trading price. This means there is also a possibility the covered call could expire worthless, allowing the investor to keep both the shares and the premium collected. Current data suggests a 52% chance of this occurring. For ongoing updates, Stock Options Channel will track these probabilities and the trading history of the option contract on their website. If the covered call expires worthless, the premium represents a 3.98% additional return, or 33.75% annualized, another instance of the YieldBoost.

Both the put and call contracts exhibit an implied volatility near 36%. In line with this, we compute the trailing twelve months’ actual volatility, factoring in the last 250 trading days and today’s price of $578.52, to also be 36%. For additional ideas regarding put and call options contracts, please visit Stock Options Channel.

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Also See:

• XLV Historical Stock Prices
• FSCI Videos
• NTAP 13F Filers

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