Investors in Devon Energy Corp. (DVN) gained access to new options today, expiring on September 25th. Two notable contracts emerged: a put at the $39.00 strike price with a current bid of $0.30, and a call at the $45.00 strike price with a bid of $0.50. The $39.00 put represents a 9% discount to the current trading price of $42.73, offering a potential effective purchase price of $38.70 after accounting for the premium.
The odds of the $39.00 put contract expiring worthless are approximately 74%, potentially yielding a 0.77% return (annualized at 5.62%) if it does. Conversely, the $45.00 call, which is 5% above the current price, has a 58% chance of expiring worthless, potentially providing a 1.17% return (annualized at 8.54%) if it does not get exercised.
Implied volatility for the put is at 53%, while for the call, it’s at 44%, compared to the actual trailing twelve-month volatility of 34%.
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