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Investors in Amazon.com Inc (AMZN) gained access to new options today, with key contracts set to expire on May 13th. A notable put contract is available at a $255.00 strike price, currently with a bid of $6.60, offering a cost basis of $248.40 per share if exercised. This strike price represents a 2% discount to the current trading price of $260.64, with a 59% likelihood of expiring worthless.
On the call side, there’s a contract at a $265.00 strike price with a current bid of $6.55. If investors buy AMZN shares at the current price and then sell this covered call, they could see a total return of 4.19% if the stock is called away at expiration. The $265.00 strike is also about 2% above the current price, with a 56% chance of expiring worthless, retaining both shares and premiums collected.
The implied volatility for the put contract is 51%, while the call carries an implied volatility of 50%. The trailing twelve-month volatility for AMZN is calculated at 31%.
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