Investors in Capital One Financial Corp (COF) can now explore new options expiring on August 28th. Key highlights include a put contract at a $195.00 strike price, currently trading with a bid of $7.80. If sold to open, this contract allows investors to buy COF shares at $195, effectively lowering their purchase cost to $187.20, representing a 1% discount from the current price of $196.92 per share. Analytical data suggests a 55% chance that this put contract may expire worthless, offering a potential 4.00% return on cash commitment, equivalent to an annualized 29.20%.
On the calls side, a $200.00 strike price call contract is available with a current bid of $7.00. Should an investor buy COF shares at $196.92 and execute a covered call, they could achieve a total return of 5.12% if exercised by the expiration date. The likelihood of this contract expiring worthless is estimated at 52%, potentially resulting in an extra 3.55% return, or 25.95% annualized.
The implied volatilities for the put and call contracts are 37% and 36%, respectively, while the actual trailing twelve-month volatility is calculated at 32%.
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