New Apple Options Trading Unveils Interesting Opportunities for Investors
Investors in Apple Inc. (Symbol: AAPL) witnessed new options become available for trading today, set to expire on May 23rd. At Stock Options Channel, our proprietary YieldBoost formula has analyzed the AAPL options chain and pinpointed a noteworthy put and call contract for consideration.
Put Contract Insights
The highlighted put contract features a strike price of $205.00, currently sporting a bid of $9.20. Selling-to-open this put contract obligates the investor to purchase shares of AAPL at $205.00 while also receiving the premium. This transaction effectively lowers the cost basis of the shares to $195.80, excluding broker commissions. For an investor interested in acquiring shares of AAPL, this represents an appealing alternative to the current market price of $206.06 per share.
Given that the $205.00 strike price corresponds to roughly a 1% discount from the ongoing trading price, there exists a possibility that the put contract could expire worthless. Current analytics, including the Greeks and implied Greeks, indicate that there is a 54% chance of this outcome. Stock Options Channel will monitor these odds and publish updates over time on our website under the contract detail page. Should the contract expire worthless, the premium would yield a 4.49% return on the cash commitment—or an annualized 32.76%, referred to as the YieldBoost.
Charting the Options Landscape
Below is a chart showcasing the trailing twelve-month trading history of Apple Inc., marking the position of the $205.00 strike price in green:
Covered Call Contract Analysis
On the call side, a contract with a strike price of $210.00 has a current bid of $8.05. If an investor buys shares of AAPL at the current price of $206.06 and then sells-to-open this call contract as a “covered call,” they obligate themselves to sell the shares at $210.00. Inclusive of the premium collected, this could generate a total return of 5.82%, assuming the stock gets called away at expiration (before broker commissions). However, potential upside remains if AAPL shares surpass this level, underscoring the importance of analyzing the trailing twelve-month trading history and business fundamentals of the company. Below is a chart illustrating AAPL’s trading history, with the $210.00 strike price marked in red:
The $210.00 strike price, representing approximately a 2% premium over the current trading price, also carries a risk of expiring worthless. In that scenario, the investor retains both their shares and the premium collected. Current data suggest similar 54% odds of this happening. Stock Options Channel will track these probabilities over time and regularly publish related analytics for the option contract. If the covered call contract does expire worthless, the premium would yield an additional return of 3.91% for the investor, or an annualized 28.52%, also known as YieldBoost.
Volatility and Market Context
The current implied volatility for the put contract is 34%, while the call contract stands at 35%. In contrast, the actual trailing twelve-month volatility, calculated using the last 251 trading days alongside today’s price of $206.06, is estimated at 26%. For additional put and call options strategies worth exploring, visit StockOptionsChannel.com.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
