Investors in Take-Two Interactive Software, Inc. (TTWO) have new options available for the April 17th expiration, including a put contract at a $195.00 strike price with a current bid of $7.30. Selling to open this put would require the investor to buy shares at $195.00, effectively lowering their cost basis to $187.70, a 7.15% discount from the current trading price of $201.56. There’s a 62% chance this contract could expire worthless.
Conversely, a call contract at a $220.00 strike price is available with a bid of $5.20. Selling a covered call at this strike would yield a total return of approximately 11.73%, assuming the stock is called away at expiration. The $220.00 strike represents a 9% premium to the current price, with a 69% chance of expiration without value.
Current implied volatilities for the put and call contracts are 35% and 39%, respectively. The trailing twelve-month volatility for TTWO is calculated at 30%.
