Investors in Canadian Natural Resources Ltd (CNQ) are now able to trade new options with a July 17 expiration, following the introduction of new contracts today. The put contract at a $42.50 strike price currently has a bid of $0.05, presenting an opportunity for buyers willing to purchase shares at that price, effectively lowering their cost basis to $42.45 per share. This strike price represents a roughly 5% discount to the current trading price of $44.73 per share, with a 65% chance of the put expiring worthless.
On the calls side, the $45.00 strike price call contract has a current bid of $1.05. If investors buy CNQ shares at the current price and write the call, they commit to selling at $45.00, potentially yielding a total return of 2.95% if the stock is called away at expiration. The likelihood of this call expiring worthless is estimated at 49%, which would allow the investor to retain both shares and premiums collected. The implied volatility for the put and call contracts stands at 36% and 37%, respectively, while the actual trailing twelve-month volatility is calculated at 28%.
