Investors in Amazon.com Inc (AMZN) saw new options trading begin today for contracts expiring June 24th. Key contracts include a put option at a $235 strike price, currently bid at $1.30, offering an alternative entry point below the current share price of $247.73, equating to a cost basis of approximately $233.70. This put option, which is approximately 5% out-of-the-money, has a 78% probability of expiring worthless, potentially yielding a 0.55% return on cash commitment, or 13.46% annualized.
Additionally, a call option at a $250 strike price, bid at $5.20, allows investors to sell shares at this strike while trading at current prices. If exercised, it offers a 3.02% total return, excluding brokerage fees. This call option has a 52% chance of expiring worthless, meaning holders would retain their shares and the premiums, translating to a potential 2.10% extra return or 51.08% annualized. The implied volatility for the put is 37%, while for the call, it is 32%.
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